Friday October 17, 2008

Uranium price falls to $47 per pound, lowest since Jan 2006

bloomberg.com :

The price of uranium dropped to the lowest level since January 2006 as utilities held off purchases, expecting the metal used to fuel nuclear reactors to continue declining. Uranium-oxide concentrate for immediate delivery fell to $47 a pound, TradeTech said in a report dated 10 Oct 2008. Demand dropped below 2 million pounds, while supply rose to more than 4 million. Uranium has fallen 37% from this year's high of $75 as funds pulled back from commodities, concerned that a US economic decline may slow new construction and business expansion.

- Uranium is proving to be quite volatile, both greatly outperforming crude oil on the upside and now greatly underperforming crude oil on the downside. The movements in the uranium mining shares are even more pronounced, with many of them being wiped out for 80-90% losses. If you have the cash, you can pick up some of those today for 10 cents on the dollar, with some of the juniors that have blocks of land in fairly prospective areas going at a price/book ratio of like 0.1. One could suppose that there could be more profit to be made right now by buying up the entire company, selling the land and pocketing the difference. But then, in these credit crisis days, who's got the cash?

See also :

1. Miners and utilities at odds over uranium price forecasts
2. Uranium crossover has occurred
3. Uranium price jumps to record 40-year high
4. Developing countries eye nuclear power: report

(2008-10-17 22:36:18 SGT) [Energy] Permalink

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