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  • World Is Revisiting The Uranium Industry 0 comments
    Apr 5, 2013 1:13 AM

    The logical solution that Nuclear Power provides for the global energy shortage is what makes Uranium mining and production an important aspect of any nation's Energy Policy.

    The radioactive metal has now become all the more interesting for the street veterans due to the bottoming out of the physical markets andUranium Mining funds and equity. Although an organised buying in the Uranium Industry is much due, foreign Investors aiming to profit from the developments in the Nuclear Energy Industry through investments in Uraniummay most keenly look at Uranium ETFs that follow a known index and rather than outperformance, the fund managers try to deliver in tandem with the these AG&G powered NASDAQ indices.

    The world-wide adoption of a clean energy stance is only with one singular goal of achieving minimum dependence on the fossils fuels and non- renewable sources of energy. Governments worldwide understand the criticalities of the issue thus even emerging nations such as China are strongly advocating use of alternative sources of energy be it Wind, Hydro, Solar and Nuclear energy that are unconventional and renewable power resources available to us.

    In Japan (recovering from the 2011 earth quake and the Fukushima disaster) year 2012 saw the nation's inclination to build plenty solar energy / electricity plants. However, Japan, China, India and even United Kingdom strongly assert on the bright future prospects for nuclear power.

    Japan with allprobability willnow begin to re start its reactors and the interim government has also won over the local opposition.

    Investing in Uraniumas a commodity is a means of investing in nuclear power and a similar exposure is enabled through ETFS and futures. However Uranium mining funds are not physically backed but provide a broad based exposure in the corporations that are involved in mining and production of the metal. The investor can easily capitalize on these stocks with one simple transaction through the Exchange traded funds at an annual expense fee.

    On the other hand Future contracts are characterised with higher risk and volatility factors.

    In the United States about more than 20 % of electricity supply is perpetuated by the nuclear power, since the year 1990. In a calculation made there are a total of 65 power plants and 104 commercial nuclear reactors in this country. Till last year there was one new nuclear reactor under creation. And nine more were passing through the last stage of planning and implementation.

    In the emerging markets like China there were about 27 new reactors under building till recently. The Chinese cabinet has shown faith in its nuclear program.

    India too is fast keeping pace with its 20 nuclear reactors in six power plants and approximately seven more reactors to come up. India wants to triple its electricity generation capacity through the nuclear power in the next two and a half decades or so. By the year 2020 this country aims to increase manifold its nuclear power capacity to 20000 megawatts from less than 5000 megawatts as of now.

    In an estimate by the International Atomic Energy Agency (IAEA) 90 new nuclear plants will become fully operational around the globe by the year 2030. In short span of last 2 to 3 years about 10 new plants began working.

    Cameco Corp. which is the biggest pure play miner of the commodity announced that the sale were higherin 2012 by approximately 22 - 23% Vis-a -Vis 2011.Largest project of this firm -Cigar Lake mine of Canada is expected to produce 1 million pounds of yellow cake annually by the end of the current year and plans to take over similar properties in future to achieve its goal of doubling its production by the year 2018.

    A near term supply deficit may not be ruled out, hence a strategic entry in uranium ETF and Uranium Mining Equity may suit those who are long on Nuclear Power.

    Uranium invest seeks to deliver in tandem with the Solactive Global Uranium Index. Being a pure play, Global X uranium mining fund replicated the asset holdings of the index and the management charges 0.69% as annual fee.

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