The uranium market has been looking for something to cheer about lately. And this week finally got some positive news–from a place that’s long been a drag on the sector.
That’s Japan. Where reports are emerging that the first idled nuclear reactors may be nearing a restart.
Bloomberg reported this week that Japan’s Nuclear Regulation Authority has taken the first steps toward rebooting two reactors. Both of them part of the Sendai facility run by Kyushu Electric Power Company on the country’s southernmost island.
These regulators have reportedly finished safety checks at Sendai’s two reactors. Finding no outstanding problems with the equipment or structures here.
A draft report has now been created on the safety approval. Which could serve as a trigger for a formal approval of the restart of operations.
Of course, nothing’s happened yet. And these two reactors represent only a small portion of the overall Japanese fleet–all of which currently continues to stand idle.
But these developments are a ray of hope. Particularly since the Nuclear Regulation Authority is a brand new body, created in the wake of the Fukushima incident that halted Japan’s nuclear output.
This week’s announced checks thus represents the first “road test” of the Authority’s approach to nuclear going forward. And the so-far positive results suggest the regulators are indeed open to a return of atomic energy.
There’s no timeline yet on when restarts at Sendai might happen. But the news was taken a symbolic victory by uranium investors–who bid up stocks like major producer Cameco by as much as 5% yesterday.
These gains are likely to continue if we do see further progress toward reactivation of Japanese plants. The real thing to watch will be the effect on uranium prices themselves–which could gain strength if buyers see supply tightening on coming increases in Japanese demand.