By Rudi Filapek-Vandyck

It would appear that China has emerged as the potential saviour of uranium prices this month. Industry consultant TradeTech notes how buyers have taken the view that spot U3O8 prices have probably seen their bottom this year and that higher prices from here onwards should be expected.

The switch in market view appears to have come on the back of indications that Chinese buyers are seeking to secure long term supply contracts. The Chinese market emergence comes at a time when the US Department of Energy (DOE) has again entered the market to sell the final lot of inventory being sold in 2010 to fund cleanup efforts at the Portsmouth enrichment facility.

In the past, whenever the DOE offered uranium for sale, prices and overall market activity have tended to weaken.

The DOE is inviting bids for just over 250,000 tonnes of uranium in the form of UF6. TradeTech reports bids are due no later than July 2, with delivery to occur on August 6, 2010.

TradeTech estimates over 500,000 tonnes in uranium equivalent changed ownership last week and a further 200,000 is expected to have changed hands on Monday or Tuesday.

The uptick in overall market activity has caused a minor rise in the consultant's weekly spot price indicator; from US$40.75 to US$41/lb (up US25c).

TradeTech's mid-term price indicator has remained unchanged at US$50/lb, its longer-term indicator has remained at US$60/lb.

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