A New Dawn For Uranium

The initiation and control of a self-sustaining nuclear reaction took place beneath the west stands of Staff Field in Chicago on December 2, 1942. This experiment led by Enrico Fermi ushered in a new era of science. The power of the atom had been unleashed. It was to result first in new weapons of war and later in a host of peacetime uses, such as the generation of electric power, diagnosis and treatment of disease, use of radio isotopes in agriculture and industry, and many others.
The uranium U3O8 spot market price indicator for the week of June 19, 2006 was $45 per pound.1 This spot price is $2 higher than the spot price at the end of May 2006,2 and approximately $38 higher than the spot market price in 2001. Long-term contracting prices could be expected to obtain $46.50 - $47.00 per pound.3 The amazing rise in the price of uranium has produced intense interest in this element, not seen since the Atomic Energy Commission's (AEC) Uranium Procurement Program started in 1947. Whether this cycle in the uranium mining and processing market will continue on an upward price trend, or crash as the first boom market did, remains to be seen. This article will examine some of the factors that devastated the domestic uranium producing industry during the first boom cycle and look at supply/demand issues that will govern the success of the latest surge in uranium market activity.