It’s a seller’s market….
A major paradigm shift may be underway in the nuclear power industry.
The uranium market has soundly rejected at least one request for a proposal from South Korean nuclear officials.
The market price for uranium might need a much higher point of price discovery.
Utility fuel buyers may need to reflect on an emerging supply and demand imbalance, that could tip the scales significantly in the favour of mining companies.
According to people keeping an eye on the Korean market, a nuclear fuel public tender was recently rejected by the global uranium industry.
The reason is likely due to a much lower expected purchase price point per pound than current and evolving market expectations.
The Korea Hydro & Nuclear Power Co, set out a proposal in September 2023 for uranium supply, which was not received well by the industry.
According to reports, KHNP wanted a $58 floor for uranium and a $90 ceiling for uranium fuel.
With the price of uranium now over $80/lb on spot markets, it rightly appears no uranium supplier in the world was willing to even entertain the proposal.
“This contract did in fact go no bid so it is back to the drawing board for the Koreans to adjust terms to the new market reality,” wrote, U308 Renaissance Man, a nuclear energy commentator on Twitter/X.
“In a structurally undersupplied market, the power shifts to the producers,” he noted.
In a forecast analysis by TradeTech, a uranium and nuclear power consulting firm noted that “the quickly evolving market conditions (for uranium) render it difficult for suppliers to meet buyer requirements”.
This contract did in fact go no bid so its back to the drawing board for the Koreans to adjust terms to the new market reality. In a structurally undersupplied market, the power shifts to the producers. Bullish for the #uranium outlook. https://t.co/4xtt8XjB9T— U308 Renaissance Man (@U308RM) November 22, 2023