It’s news that’s almost worth writing home about! Uranium
investors will be pleased to note that the uranium spot price
showed some signs of life this week. U3O8 prices have managed to
claw their way up to $30 for the first time since late
Despite still being down a miserable 12.9 percent from $34.33 at
the end of 2013, U3O8 made an impressive gain this week, trading
hands 4.3 percent higher than the previous week.
What’s behind this sudden move, you ask?
As Raymond James analyst David Sadowski states in a new
Weekly Uranium Tracker, so far in August, trading volume is up 1.3
million pounds on continued interest from traders and
Part of the fuss has been brought on by Russian sanctions, which
remain a catalyst for buyer interest. Indeed, as Sadowski
highlights, sanctions are “contributing to the recent run-up in
spot pricing, up US$1.69/lb in six trading days.”
Also of note, is long-term volume, which is still at zero.
However, “interest remains strong as evidenced by three utilities’
request for a total of ~5.8 Mlbs.”
Cameco labor dispute could result in strike
As one of the biggest fish in the pond, investors definitely
take cues from Cameco (TSX:
when it comes to the uranium market.
Cameco has been in talks with unionized employees at both
McArthur River and Key Lake since November 2013, as collective
agreements expired at year end.
Since then, no agreement has been reached, which has resulted in
the potential for work stoppages should no agreement be reached
before August 30, 2014. Indeed,
week, 92 percent of unionized workers at the mines voted in
favor of going on strike at month end should no agreement be
reached with the company.
As Cameco spokesman Rob Gereghty told reporters, the company has
“a long relationship with the union and hope[s to] reach an
Commenting on the latest development with the top uranium miner,
Salman Partners analyst Raymond Goldie said in a research note to
clients that “[b]ecause the market would perceive that any loss of
sales volumes would be more than offset by increases
in uranium prices, we suspect that if there were to be a
strike, Cameco’s share price would rise.”
Now that the spot price has firmed up just a touch, the overall
hope is that equities will follow — despite the depressed pricing
environment, companies are still hard at work on their
Athabasca Basin uranium darling Fission Uranium (TSXV:
announced more assay
from five holes drilled during the 2014 winter program on the R780E
zone at its Patterson Lake South property. The company highlighted
holes PLS14-209 (line 510E), which returned composite assay
intervals including 21.97-percent U3O8 over 10 meters within a
larger interval of 5.19-percent U3O8 over 57 meters.
Another bright spot is hole PLS14-215 (line 660E), which
returned composite assay intervals of 11.8-percent U3O8 over 22.5
meters within a larger interval of 6.29-percent U3O8 over 48.5
meters. Mineralization from both holes is high-grade and was
intercepted at a shallow depth.
Fission also notes that all five reported holes returned
high-grade intervals of mineralization.
Forum Uranium (TSXV:
results today from a 2014 winter drill program at the Northwest
Athabasca JV project. The program included a total of 2,911 meters
in 13 holes on five separate targets.
In today’s press release Forum highlights the Maurice Bay
deposit, which shows 1.61-percent U3O8 over 5.5 meters, Otis
West, which shows 0.95-percent U3O8 over 0.3 meters within a
30-meter-wide zone of radioactivity, Zone A, which indicates 263
ppm U3O8 over 4.8 meters, and Maurice Bay East, which returned
166 ppm U3O8 over 1.8 meters and up to 0.56-percent boron.
Encouraged by the results, Forum said that further drilling is
recommended on all target areas.
Securities Disclosure: I, Vivien Diniz, hold no investment
interest in any of the companies mentioned in this