Contraction and consolidation of the uranium production industry

The uranium industry has followed the vicissitudes of the nuclear industry closely, albeit with a slight time lag. Expansion of the uranium industry in the 1970s was spurred on by increasing spot prices as utilities moved to secure supplies of uranium for the reactors they had ordered. During this time production was always in excess of consumption and, when coupled with the subsequent cancellation of reactor orders, it was only a matter of time before prices began to fall. With the fall, which has been significant in real terms, profitability has been severely reduced, especially where production costs have risen. The result has been mine closures and production cut-backs. There is the possibility of a big excess from the USSR. Together with the forecast of only modest expansion in the nuclear power industry in the next 10 to 15 years, these facts provide the basis from which the future of the uranium mining industry is considered. It is concluded that a new industry structure will emerge with fewer participants so that the market supply and demand is more closely matched. (author)