Uranium, like silver, is still also trading far below its all time high. In 1979, uranium reached an all time high of $150 per pound, today it trades for just over $50. Think about that, the population has grown by 3 billion since 1979, China, Russia, and the entire east is rising, more energy is needed than ever, oil is over $100 per barrel, yet uranium is still dirt cheap.
The demand for uranium is almost entirely driven from nuclear reactors. Today there are over 430 operating nuclear reactors in the world in 30 countries. Current consumption is about 180 million pounds per year, but total mine production is only about 135 million pounds per year! That’s right, uranium prices are depressed, and we have a 45 million pound supply deficit. Now for the past 20 years, the world has consumed more uranium than we have produced. This deficit has been met with government and military inventories of uranium, this has added 25 million pounds per year mainly as a result of the Highly Enriched Uranium treaty between the U.S. and Russia. However, this treaty expires next year!
Does anyone else see the potential for a trend?!!!
With Uranium trading for $52 a pound, the only way we can see more uranium come online is to make the more expensive properties economically feasible, that means we need to see uranium prices over $100 per pound.
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