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Secondary Uranium Supply

Primary mine production supplies approximately 86% of current demand. The balance of demand is supplied from secondary sources such as commercial inventories, reprocessing of spent fuel, sales by uranium enrichers and inventories held by governments, in particular the U.S. Department of Energy.

Excess commercial inventories, which were once one of the major sources of secondary supplies during the period from the early 1970s to the early 2000s, have largely been consumed; however, as a result of the shutdown of the German nuclear program and the continued shut down of the majority of the Japanese nuclear fleet, commercial inventories could become a more significant factor. A large source of secondary supplies continues to be government inventories, particularly in the U.S. and Russia. The disposition of these inventories may have a market impact over the next 10 to 20 years, although, the rate and timing of this material entering the market is uncertain.

Secondary supplies remain a complexity of the uranium market. UxC previously forecasted that 39.7 million pounds U3O8 would enter the market from secondary supplies in 2015. A year later, in the Q4 Outlook UxC reported that 47.6 million pounds actually entered the market from secondary supplies in 2015. This represents a nearly 20% increase in secondary supplies and nearly a 4% increase in total supplies entering the market in 2015.

Looking ahead, UxC expects that secondary sources of supply will fall from 2016 levels of 45.9 million pounds U3O8 per year to only 30.7 million pounds U3O8 per year by 2025.  
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