Secondary supply sources still abounding - Yet demand for new uranium production projects

Secondary Supply Sources Still Abounding - Yet Demand for new Uranium Production Projects There have been repeated warnings in the past of impending uranium scarcity and, as a consequence, expected drastic price increases. However, just as often, extensive civilian (excess inventories of reactor operators and former strategic stockpiles) as well as military sources of supply (former weapons-grade material converted into reactor fuel) opened up unexpectedly. These so-called secondary sources had a major negative impact on uranium prices, resulting in a strong movement towards consolidation in the uranium industry and decreasing the number of producers. However, there have been more and more indications in the past few months that uranium could indeed become scarce on a medium term. The secondary sources still available to meet requirements are gradually declining, and even the conversion into nuclear fuel of more material from the weapons stockpiles of the two superpowers, United States and Russia, could postpone only slightly the point in time at which fuel would become scarce. This indicates the urgent need for a major increase in uranium production in the West. However, there may be considerable financial obstacles in the way of stepping up production in existing uranium mines and building and commissioning new ones. Should uranium producers be unable, or unwilling, to invest new uranium mines despite expected clear price increases, reactor operators could be called upon to invest part of their capital into new uranium mines and dressing facilities.