Tuesday, May 05, 2009

Cameco buying cheap uranium on spot market - National Post

Cameco Corp. is aggressively buying uranium in the spot market as it looks to take advantage of "trading opportunities" in the radioactive metal.

Cameco's decision to buy up uranium in the thinly traded spot market is evidence the company thinks it is undervalued and that it can sell the product in the future for a profit.

This follows a collapse in the uranium spot price, which peaked above US$130 a pound in 2007 before plummeting to just US$40 a pound this year. It recently rebounded to US$44 a pound, according to Ux Consulting.

This explains why the spot price has stopped falling and reversed in recent weeks.

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