Uranium Producers Slow Production to Conserve Margins
October 17 2011 - 8:16AM
Marketwired
Uranium prices are finally starting to stabilize as companies are
cutting back on production. Demand has softened following the
Fukushima nuclear disaster, leading producers to slow production to
conserve margins. The Bedford Report examines the outlook for
companies in the Uranium Sector and provides investment research on
Cameco Corporation (NYSE: CCJ) (TSX: CCO) and Denison Mines
Corporation (NYSE Amex: DNN) (TSX: DML). Access to the full company
reports can be found at:
www.bedfordreport.com/CCJ
www.bedfordreport.com/DNN
Uranium prices have yet to recover from the aftermath of Japan's
devastating earthquake in March. Demand has slumped as Germany
announced plans to close all 17 of its nuclear power reactors by
2022. Until recently, production remained on the upswing. However,
earlier this month the world's top producer, Kazakhstan, announced
that it has stabilized production to around 20,000 metric tons
annually in order to avoid further depressing prices.
Sergei Dara, Director of Strategic Development and International
Projects at Kazatomprom, the state nuclear company, said as long as
prices remain at their current low levels, "Kazakhstan will not
develop new projects and our production will remain at the current
level."
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Cameco, with its head office in Saskatoon, Saskatchewan, is one
of the world's largest uranium producers. The company's uranium
products are used to generate electricity in nuclear energy plants
around the world. The company said it now sees global uranium
demand in 2011 at 175 million pounds, compared with a previous
estimate of 180 million pounds. It forecasts world uranium demand
in 2020 at 225 million pounds, down from an earlier estimate of 230
million pounds.
Denison Mines Corp. is an intermediate uranium producer with
production in the U.S., combined with a diversified development
portfolio of projects in the U.S., Canada, Zambia and Mongolia. The
Company recorded a net loss of $13,749,000 or $0.04 per share for
the three months ended June 30, 2011 compared with net income of
$16,744,000 or $0.05 per share for the same period in 2010.
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