Uranium under fire as left wing France examines its options. RSA’s Waterberg moves on, but spasmodically. India’s coking coal appetite sharpens.

The New French Government, elected on a left wing ticket, is anti-nuclear. As we note in counties, it is proposing to cut down on that source of energy by 25% to 2025. This matters a tad more than meets the eye. Its consumption of over 97Mt of oil equivalent is more than 15% of the world’s total. It is eclipsed only by the USA (31%) and leaves Russia (6.2%) and South Korea (5.3%) trailing. Now Germany (5.1%) is opting out, it will take a super human effort by China (2.7%) to bridge the gap. So where does this leave the argument for expansion? The UK policy (2.2%) is in total disarray and yet the miners keep pumping it out. France plans to embrace renewables; we wish it luck. A wind turbine atop the Eiffel Tower?

None of this stops Uranium One (TSX, JSE) a top-tier miner with 3% of world output, telling us the fundamentals are ‘extremely strong’. Let’s ignore the spot price at our peril. It was $90/lb U3O8 four years ago, $51/lb now.

India’s Coking Coal Appetite remains unsatisfied. It looks to 36.8Mt in 2012 and 43.3Mt in 2013, against a background of increasing steel demand and lower domestic production. The numbers are quite daunting:

China will not stay still. Come on, Mozambique, where are you?

Uranium One, Canada’s No 2 and world No 8 miner saw its Q1 profits fall as lower prices outweighed higher sales volumes. The numbers were $45M against $14M. Production was 2.8Mlbs, targeting a full year 11.6Mlbs. It also has assets and options in Tanzania, Kazakhstan, USA and Australia.

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About David Hargreaves

David Hargreaves

David Hargreaves is a mining engineer with over forty years of senior experience in the industry. After qualifying in coal mining he worked in the iron ore mines of Quebec and Northwest Ontario before diversifying into other bulk minerals including bauxite. He was Head of Research for stockbrokers James Capel in London from 1974 to 1977 and voted Mining Analyst of the year on three successive occasions.

Since forming his own metals broking and research company in 1977, he has successfully promoted and been a director of several public companies. He currently writes “The Week in Mining”, an incisive review of world mining events, for stockbrokers WH Ireland. David’s research pays particular attention to steel via the iron ore and coal supply industries. He is a Chartered Mining Engineer, Fellow of the Geological Society and the Institute of Mining, Minerals and Materials, and a Member of the Royal Institution. His textbook, “The World Index of Resources and Population” accurately predicted the exponential rise in demand for steel industry products.