Kazakhstan shocks uranium market

On Monday, the world's largest uranium producer surprised market experts with a larger-than-expected cut in production.

State-owned Kazakhstani producer Kazatomprom has announced its intention to cut U 3 O 8 output by 20% or 11,000 tonnes (about £ 28.5 million) over the next three years, starting in January 2018. According to the company, approximately 4,000 tonnes will be cut in 2018 alone, which will amount to approximately 7.5% of global uranium production in 2018.

The head of Metals and Mines Canada, in a study published on Monday, said Kazatomprom is playing a more important role in the market and a larger-than-expected decline in supply, which will stimulate the price of U 3 O 8 amid expected production at 2018-20 ".

The Kazakh shock, coupled with a production shutdown in Canada, will push uranium prices to an average of $ 20 /lb and possibly $ 30 /lb. However, the rate of growth may be slightly lower as there is a limited number of qualified buyers of uranium, which makes the market less efficient.