Uranium Investing News takes a look back at how uranium fared during the turbulence of 2014, speaking with analysts and CEOs about the market. Overall, while the market spent 2014 mired in disappointment and underperformance, the year looks set to finish on a strong note.
The uranium market spent 2014 mired in disappointment and underperformance, but the year looks set to finish on a strong note amidst optimism that the industry could be on the verge of a significant rise. In the past six months, the spot price of uranium has risen 50 percent, while interest in long-term prices has also risen. During that time, news surfaced that two nuclear reactors in the Sendai district will be restarted in 2015, and that has further stoked interest in the market. That said, David Talbot, a senior analyst with Dundee Capital Markets, sees utilities companies reentering the fray as they look to secure long-term supplies of the commodity as the biggest news of the past year. Indeed, term contracting has secured at least 69 million pounds of uranium this year — that's three times the amount sold in 2013, but still below the 100-million-pound average seen over the past eight years, said Talbot. Caught off guard At the start of the year there were high hopes for uranium, with interest percolating after the dismal years following the Fukushima disaster. Prices stayed relatively stable before falling off the edge in March, tumbling down to the high $20 range. "I incorrectly thought we would enjoy a positive year in the resource markets. The first portion saw appreciation in share prices across our sector, but the last few months of 2014 have proven challenging," said Jim Paterson, CEO and director of Kivalliq Energy (TSXV: KIV). Analysts were also surprised by the length of time it took for reactor restarts in Japan to gain formal approval. David Sadowski, an analyst with Raymond James, said he had expected six nuclear reactors have restarted by Christmas.