Kazatomprom Announced Production Cuts to Address Uranium Oversupply
| Date: Dec 05, 2017 |
| Western Uranium Corporation (CSE:WUC) (OTCQX:WSTRF) (“Western”) wishes to highlight the positive uranium news released out of Kazakhstan this morning. Subsequent to the 2008 Global Financial Crisis and 2011 Fukushima nuclear accident, global uranium demand has stagnated causing oversupply which has depressed market prices. Uranium production cuts have been anticipated and in this fourth quarter these have been put in place by a number of major uranium producers for 2018.
Today Kazatomprom, the world’s largest uranium producer announced its intention to reduce planned production by 20%. According to the Kazatomprom announcement, this action will remove over 8 million pounds from the market in 2018 and approximately 24 million pounds of uranium over a three year period. In making this announcement, Kazatomprom cited the goal of better aligning their production levels with market demand. This follows the Honeywell announcement on November 20th that its ConverDyn conversion facility would be immediately idled. The diminished production of uranium hexafluoride (UF6) from this last operating conversion facility in the United States removes approximately 15 million pounds of uranium from the market. Honeywell put forth similar rationale noting that the current oversupply has caused a downward trend in uranium markets. |
