Near Term Deployment, Long Term Impact: Uranium Price Over the Lifetime of New Capacity

While reasonable short-term resource price projections can be obtained by taking a bottom-up approach — constructing a supply curve based upon current production capacities and costs — this approach breaks down as the time horizon of the analysis lengthens. One approach to long-term price forecasting is to calibrate a simple model of a commodity market against past data. To that end, an analogy was drawn between the behavior of the uranium market and that of some three dozen materials for which the United States Geologic Survey (USGS) maintains data. This work adds to previously published results showing that the USGS-reported prices of minerals similar to uranium have consistently declined over the past century. In this paper, the extent to which uranium geology and extraction technologies are indeed analogous to other minerals is quantitatively addressed. A study of crustal abundances, ore grades being economically mined, concentration factors, market share of extraction techniques, years of proven reserve and other factors indicates that uranium is not at all exceptional with respect to the average of the USGS minerals. This suggests that, on the supply side, the analogy between the USGS minerals and uranium may indeed offer valuable insights into medium and long term uranium price behavior.