Uranium prices in 2007 can grow more than twice - forecast of RBC Dominion

/INTERFAX, Toronto, November 20, 06/ - Spot uranium price on the world market in 2007 can grow more than twice compared to the level of 2006 - on average to $100 per pound of uranium protoxide-oxide ($260 per 1 kg), consider analysts of Canadian RBC Dominion Securities Inc. RBC Dominion Securities Inc. substantially increased its forecast of growth dynamics of world uranium prices in the nearest future due to flood on the Canadian mine Cigar Lake, which detained the output of enterprise's first production for 2 years, informs Bloomberg. In the opinion of RBC analysts, uranium price in 2007-2015 will be "substantially higher" than it was forecasted before, because the underground flood stopped the project of Cigar Lake, where the Canadian company Cameco planned to start uranium production next year. It is assumed that in the perspective 11% of the total volume of uranium production in the world will be mined on Cigar Lake. "There is a high probability that the price on the spot market will reach $75-80 per pound ($195-208 per 1 kg) by the end of 2006 and will proceed with growth in 2007 as a result of the real density on the market and owing to investors' influence," is noted in the report of RBC. According to data of RBC, the average spot price of uranium, which is used for production of nuclear fuel, in 2006 totaled $45.34 per pound of uranium protoxide-oxide ($117.8 per 1 kg). Current spot price, according to data of Ux Consulting, is $62.5 per pound ($162.5 per 1 kg). Besides, analysts increased the forecast of average spot uranium prices for 2008 from $50 to $85 per pound ($130 and $221 per 11 kg respectively), and for 2009 - from $40 to $75 ($104 and $195 per 1 kg). RBC Dominion Securities Inc., the Canadian broker company, is the part of Royal Bank of Canada. [2006-11-20]