http://www.businessinsider.com.au/uranium-is-set-for-a-violent-move-higher-2013-10

PR: BTW: Looks like a typo and he means 2015 (not 2014) $62.50/lb...

PR: My bolding, and Cantor Fitzgerald expects $19.25/lb average price jump between 2014 and 2015 with $70/lb. in 2016! Wonder what he expects 2020 to be?!

PR: My understanding is that NPSP may be one of the few areas where discovery->production could be shorter than his estimage (7-10 years) because of the brecia pipe concentration of mineralization.

'Cantor Fitzgerald analyst Rob Chang warns clients that uranium is “set for a violent move higher” in his latest note.

The metal has been on a steady grind lower for most of this year, much like most of the past three years.

The reason, according to Chang: since the earthquake and nuclear disaster at TEPCO’s Fukushima power plant in April 2011, Japanese reactors have been shut down, and inventories of unused uranium have piled up, weighing on the price.

Chang thinks that is all about to change. In his note, he writes:

We continue to stress that the marginal cost of current production for uranium is US$40/lb and that the minimum incentive price for future supply to match future uranium demand is US$70/lb. The reason why the price is as low as it is now is due to excess uranium inventories stemming from material earmarked for Japan’s 50 reactors not being consumed for the last two and a half years. With Japan set to restart some reactors either late this year or early next year (we forecast 10 to restart in 2014 but none this year) this issue will soon resolve itself — especially since there are more reactors under construction, planned, and proposed now (557) than since before Fukushima (541).

In fact, we forecast that the price of uranium will make significant and dramatic moves higher when it does correct upwards. Our rationale stems from our supply and demand forecast, which indicates that there will be a large and unavoidable supply deficit beginning in 2020 as global demand outpaces global supply under the current price environment. Given that it takes 7-10 years for a uranium project to move from greenfield discovery to first production, the fact that 2020 is only six years away means that we will already have a deficit no matter what happens to uranium prices and to mine development plans.

Cantor Fitzgerald forecasts an average 2014 uranium spot price of $US43.25 per pound, an average 2014 price of $US62.50, and an average 2016 price of $US70.'