Uranium prices set to march higher as climate deal boosts nuclear

Mon Dec 28, 2015 3:00am EST
 
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* China to build 6 to 8 nuclear plants annually up to 2020

* Uranium prices to rise by more than half by 2018 - analysts

* Global surplus of the metal to halve by 2020 - estimates

By Clara Denina

LONDON, Dec 28 (Reuters) - Uranium prices are expected to outperform other commodities in 2016 and beyond as a global climate change deal and growing demand from Asia bolster the prospects of the nuclear industry.

The metal that powers nuclear reactors has been gradually recovering from a sharp decline in the wake of Japan's Fukushima disaster in 2011, and has gained this year as several other commodities slumped due to oversupply and concerns about Chinese economic growth and U.S. monetary tightening.

It is expected to climb further, according to analysts, after governments forged a landmark agreement to reduce green gas emissions at a global climate summit in Paris last month - a move that supports nuclear power generation and in turn uranium.

Nuclear power stations currently provide around 11 percent of the world's electricity but the share is likely to increase as China and India expand their capabilities.

China - seeking to reduce its dependence on polluting coal - plans to build six to eight nuclear power plants a year for the next five years, and India aims to generate 25 percent of its electricity from nuclear by 2050, up from 4 percent in 2013.   Continued...