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UPDATE 1-Uranium seen at $80 per lb by year-end -TradeTech
February 9, 2009 / 3:24 PM / 9 years ago

UPDATE 1-Uranium seen at $80 per lb by year-end -TradeTech

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CAPE TOWN, Feb 9 (Reuters) - Uranium prices, hurt when hedge funds sold holdings to cover losses in other markets, may recover by the end of the year should investors and utilities rekindle their interest, a consultant said on Monday.

The spot market price of uranium UX-U3O8-SPT has slipped to around $47 per lb, according to price reporting company TradeTech, which said the prices could recover.

Prices of the nuclear fuel hit a record of $136 in June 2007 on a wave of plans to build reactors to supply power in China and elsewhere.

“Uranium prices could recover faster if the investor segment rekindles its interest,” Gene Clark, the chief executive officer of Trade Tech told a mining conference in Cape Town.

“When utilities come back to the market, coupled with investor demand, prices could rise to $80 a lb,” he said.

“If this does not happen, our model shows prices will average between $40 and $46 a lb this year and next year.”

Clark saw the price remaining volatile this year, however.

”We expect uranium prices to continue their volatility,“ he said.”

The market has seen some additional supply of 450,000 lbs held by Lehman Brothers LEHMQ.PK, which is bankrupt, and buyers have retreated to await further declines, analysts have said.

With buyers expected to emerge for that, the bottom should be reached and the price should start to strengthen.

The easing price, difficulties with project financing and a gloomy world economic outlook have resulted in cutbacks in production and this could also support prices, Clark said. (Reporting by James Macharia, editing by Anthony Barker)

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