Uranium Surges 31% Amid Shutdowns to Become Year’s Top Commodity – by Aoyon Ashraf and Joe Deaux (Bloomberg News – April 19, 2020)

https://ca.finance.yahoo.com/

(Bloomberg) — ​​​​​​While most commodities are getting hammered by the coronavirus crisis, uranium prices are skyrocketing.

The radioactive metal used in nuclear fuel has climbed 31% this year, making it the world’s best-performing major commodity. The gains have been spurred by mine shutdowns that have wiped out more than a third of annual global output at a time when demand from power plants has remained relatively stable.

“This is a bit of a one-two punch in uranium’s favor,” said Nick Piquard, a portfolio manager at Horizons ETFs. “Not only has Covid-19 likely not impacted nuclear power demand very much, but it is certainly impacting supply.”

While demand for energy, including nuclear, is taking a hit due to the pandemic, many atomic power plants are expected to keep open. That’s partly because coal- and gas-powered plants are easier to turn on and off than nuclear facilities, so it’s worth keeping them running even if electricity demand declines somewhat, Piquard said.

The uranium industry has been in the doldrums since the 2011 Fukushima disaster in Japan, which led to the shuttering of most of that country’s nuclear reactors as well as a rethink of nuclear power worldwide. The shift led to a glut of the metal piling up in warehouses, sending prices down by as much as 75% from the highs in 2011.

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