7 Janvier 2013
January 5, 2013
By BEN SHARPLES
MELBOURNE — Uranium is poised to rebound from a second annual decline as Japan considers restarting its atomic plants almost two years after the start of the Fukushima disaster and China pushes ahead with the world's biggest nuclear building program.
The price of the fuel for immediate delivery may average $55 a pound (0.45 kg) in 2013, according to the median of five analyst estimates in a Bloomberg News survey conducted last month. The nuclear fuel slipped 14 percent to an average of $48.72 in 2012 and traded at a three-year low of $40.65 in November, data compiled by Bloomberg show. It was $43 a pound on Jan. 3.
A revival in demand from Japan is raising the prospect that supplies of the radioactive metal will shrink at the same time as China continues with a project to increase its nuclear power capacity at least fivefold by 2020. That's a boost for uranium producers such as Perth, Australia-based Paladin Energy Ltd. It's also a blow to exporters of liquefied natural gas, including Qatar and Australia, which have helped fill Japan's power shortage since the earthquake and tsunami that triggered the three meltdowns at the Fukushima No. 1 plant in March 2011.
"The biggest pressure on price at the moment is not necessarily the downgrade to demand since Fukushima, it's this massive inventory overhang," said Joel Crane, vice president of research at Morgan Stanley in Melbourne. "Should the Japanese government give the green light to restarts, that overhang is instantly gone and that will be very positive for prices."
The uranium forecasts for 2013 ranged from $45 to $62.60 a ton [shouldn’t it be per pound?] in the Bloomberg survey conducted from Dec. 10 to 19. That compares with a three-year high of $73 in February 2011, according to data from Roswell, Georgia-based Ux Consulting, which advises the nuclear industry.
The price plunged as low as $49.75 a ton in March 2011 after the offshore 9.0-magnitude earthquake rocked Japan. The subsequent tsunami damaged reactors at Tokyo Electric Power Co.'s Fukushima No. 1 nuclear plant, releasing
radiation and causing the evacuation of 160,000 people. After the disaster started, the nation's 50 workable commercial reactors all started to go offline for routine and more rigorous safety checks, and countries from China to France re-evaluated their nuclear policies. Germany meanwhile said it would close all of its facilities.
Japan's 10 regional utilities generated or purchased 2.4 percent of their electricity from nuclear plants in November, down from 27 percent in February 2011. The nation's installed nuclear capacity is 46,148 megawatts at its 50 operable plants. Fossil-fuel plants accounted for 73 percent, up from 50 percent.
Speculation that uranium demand will rebound has grown since Dec. 16, when the Liberal Democratic Party won the general election by a landslide. The previous administration, led by the Democratic Party of Japan, which ordered the shutdowns, planned to phase out nuclear power by the end of the 2030s. The LDP was ousted in 2009, two years before Fukushima, after ruling for all but 10 months since 1955 and driving the national development of atomic energy.
The new government plans to establish a variety of sources for electricity generation within 10 years and will review the plan to exit nuclear power, trade minister Toshimitsu Motegi said Dec. 28.
"We can't say for sure that Japan will be free of nuclear power by the 2030s," Motegi said at a news conference in Tokyo. "We will make our decisions based on technological findings and not with prejudgment."
The government and the utilities face heavy public opposition to nuclear power amid concern that some plants are at risk of earthquake damage. All but two of the nation's operable 50 reactors remain idled since Kansai Electric Power Co. resumed two units at its Oi plant in Fukui Prefecture in July.
The restart of the reactors is going to be "fairly slow" and is unlikely to be completed this year, capping uranium price gains, according to Thomas Neff, a physicist and uranium-industry analyst at Massachusetts Institute of Technology in Cambridge, Massachusetts.
"It's probably 2015 before you are going to get any strong demand signals sent to the market," Neff said Dec. 28. "There's no particularly good reason to think that it's going to go up in the next year."
Japan Atomic Power Co.'s Tsuruga plant in Fukui and Tohoku Electric Power Co.'s Higashidori plant in Aomori Prefecture may be sitting on active geological faults, teams of scientists working for the Nuclear Regulation Authority said last month. Kepco is conducting additional checks after a team from the new nuclear regulator delayed a decision on whether a fault under its Oi plant is active. Utilities aren't allowed to construct reactor buildings and other important facilities above an active quake fault.
Tens of thousands of nuclear power opponents held weekly protests outside previous Prime Minister Yoshihiko Noda's official residence last year. A government-backed public forum found in August that 47 percent of participants favored cutting nuclear power to zero, while newspaper polls in the last 18 months showed support for ending atomic power in Japan.
But the new prime minister, Shinzo Abe, said Dec. 26 that the government will await new safety standards before deciding whether to restart the idled reactors. The NRA has said it will announce the rules in July, and Abe hinted some of the reactors may be restarted in the next three years if they meet the tougher safety standards.
"The uncertainty around Japan is holding prices back," Jonathan Hinze, a senior vice president at Ux Consulting, said in an emailed response to questions last month. "The number one thing to help the price recover even more is additional Japanese reactor restarts."
Stockmarket investors have been betting that the resumptions will occur and boost uranium demand just as China pushes on with plans to build at least 26 new reactors. At the same time, analysts are predicting a drop in the price of LNG as Japan's utilities seek to reduce their eletricity-generation costs by switching back to nuclear.
Paladin, which operates two uranium mines in Africa and has exploration assets in Australia, rose 22 percent in Sydney in the two days through Dec. 18. Energy Resources of Australia Ltd., whose Ranger mine in the Northern Territory produces about 10 percent of the world's mined uranium, advanced 13 percent over the same period. Australia has the world's largest known deposits of the fuel, according to the World Nuclear Association.
"The uranium price and Paladin would benefit from a restart of Japanese reactors," UBS AG analysts, including Glynn Lawcock in Sydney, said in a Dec. 17 report as the bank upgraded its rating on the stock to "buy" from "neutral." "The latest change in government puts the restart one step closer, in our opinion, albeit timing remains unclear."
Kansai Electric's shares rose 18 percent in Tokyo, the most since at least 1974, the day after the LDP returned to power. The company plans to restart reactors 3 and 4 at its Takahama nuclear plant after July, it said in a Nov. 26 statement. Tepco, which surged 33 percent on Dec. 17, aims to restart all seven reactors at its Kashiwazaki Kariwa plant between this April and September 2015, according to a business plan announced in May.
China has 14 reactors operating and the new ones planned, accounting for more than 40 percent of the plants being built globally, may increase the nation's capacity to 60 gigawatts by 2020, according to the World Nuclear Association.