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Kazakh uranium production to decrease eight percent this year, say experts

27 Mar 2017 9:19 AM | Anonymous

Astana Times, 23 March 2017

Approximately 22,000 tonnes of uranium, representing an 8-percent decrease, will be extracted this year compared to a 25-percent increase in gold production, according to the research and knowledge management department of Samruk Kazyna Sovereign Wealth Fund, reported “In  2016,  nearly  24,000  tonnes  of  uranium  were  produced  in  Kazakhstan,  1.7  percent  more compared to a year earlier. In 2017, uranium production will decline 8 percent, or 2,000 tonnes, due to weak market conditions associated with an overabundance of uranium,” said department experts.

Production is expected to grow as market conditions improve. Under the plans to reduce production, uranium prices rose to more than $24 per pound from $17.75 at the end of November 2016 from the lowest level since February 2015.

Kazakhstan exports all the uranium produced mainly on long-term contracts, as the country does not own its own nuclear power plants. China remains the main importer of Kazakh uranium with a share of more than 50 percent. 

The  Central  Asian  nation,  which  mines  39  percent  of  the  world’s  uranium,  is  the  largest  global producer, followed by Canada and Australia, with shares in 2015 of 22 and 9 percent, respectively. The  same  year,  production  of  nitrous  oxide-uranium  reached  71,000  tonnes,  containing  60,496 tonnes of uranium. Uranium also comes from secondary sources, including uranium stocks in power plants.

Currently, 439 nuclear power plants globally consume uranium with an installed net power of 380 gigawatts. The U.S. is one of the largest consumers with a 28-percent share of total consumption. China  and  South  Korea  use  about  12  and  8  percent,  respectively.  Starting  in  2015,  world consumption  is  expected  to  grow  4.8  percent  annually  to  97,900  tonnes  in  2020.  At  present,  58 nuclear reactors are being built and 512 additional reactors are in the planning phase. Twenty-three Japanese nuclear reactors are in the process of restarting; in 2016, the U.S. launched its first new nuclear reactor in the last 20 years and four more are in the production stage. New nuclear reactors will mainly be built in developing countries, such as China and India, where the demand for electricity is growing rapidly. As expected, the launch of new nuclear reactors will compensate for the reduction in uranium consumption by deactivated nuclear reactors. The action will help to correct the imbalance in supply and demand and in the long term, a steady increase in the number of nuclear power plants will positively influence the uranium market. Spot uranium prices fell to $17.75 per pound at the end of November 2016, the lowest level since February 2005, and by the end of 2016 prices recovered to $20 per pound. The uranium market is supposed  to  remain  volatile  due  to  unsustainable  policies  and  the  economy.  The  market  will preserve an excess of uranium until 2020, resulting in spot prices below $30 per pound. At such low prices, however, few companies will develop new deposits. In this regard, long-term prices for uranium will be maintained by a growing demand coupled with a possible shortage of uranium supplies. In addition, main U.S. and European nuclear power plants are expected to renew long-term contracts for uranium supply in 2017-2018.