By Greg Peel

It started late last year and it has continued into January. The bulk of "real" global spot uranium demand (utilities as opposed to traders) is currently centred in Europe where U3O8 is being sought. The bulk of "real" uranium supply (not just traders) is centred in the US and it's in the form of UF6. Those needing apples in one part of the world are not interested in oranges far, far away.

Clearly this makes it more difficult for industry consultant TradeTech when trying to publish an "indicative" spot uranium price in a non-homogenous market. The bottom line is that last month simply saw some jostling between traders and producers with neither wishing to give much ground in a market where price direction is back to front. The Europeans will pay more for U3O8 than the Americans are selling UF6 for.

The month of January was quiet, TradeTech reports, seeing only fifteen spot transactions totalling 1.8mlbs of U3O8 equivalent. TradeTech's end-month price was set at US$52.25/lb but after the week ending January 3, in which five transactions totalling only 675,000lbs were completed, that price has fallen by US25c to US$52.00/lb.

There is nevertheless action in the medium and long term markets. TradeTech reports five transactions totalling 900,000lbs for delivery in 2013-14 contracted in January. The bad news is TradeTech has subsequently lowered its medium term price indicator by US50c to US$54.50/lb. There was fresh demand apparent in the longer term delivery market as well but no transactions, leaving TradeTech's long term indicator at US$61.00/lb.