|This means the uranium bears are wrong and not getting the correct info.|
Gitzel: Jonathan, I think every supplier, customer, investor and reporter should be paying real close attention to what has happened to the conversion market because while the market is different, I believe it is somewhat analogous to the uranium market. Just a few short years ago, too much capacity com- bined with too much secondary, one-time and finite supply re- sulted in an absurdly low conversion price. A price that was set by surplus disposal, de-linked from the actual production cost curve. Production curtailments began and then produc- tion challenges have been experienced in the industry. So what has happened? The price has rapidly increased over four-fold to a price linked to the actual production cost curve and, notably, the recent conversion price transition was not
02 | SEP | 2019
anticipated by fuel cycle reporters. In other words, conver- sion has already gone through the transition that uranium is starting to go through, and, like conversion, fuel cycle report- ing has clearly not yet recognized this transition and, once again, may only see it in the rear-view mirror.