Uranium miner Cameco (TSX:CCO) reported Friday an adjusted loss for its first quarter financial results as both prices and demand remains low, which has forced the Canadian company to lower its output forecast for the year.
While the Saskatoon-based miner sees a bright long-term future for nuclear power, it noted it’s been challenging so far for the uranium market.
As a result, it posted a loss oft $408 million as compared to $566 million in 2015, or 2 cents per share versus 18 cents per share in 2015.
Sales dropped 16% to 5.9 million pounds in the quarter, with the average realized price per pound down 3%.
The firm’s new production forecast for the year is now 25.7 million pounds, down from the 30 million pounds previously estimated. Output was 28.4 million pounds in 2015.
Last week, Cameco announced it was suspending production at its Rabbit Lake operation in Saskatchewan, as well as and slashing output in the US and at McArthur River, Saskatchewan, the world’s biggest uranium mine.
After being one of the best performing commodities in 2015 in terms of prices, uranium has been having a terrible year so far. The nuclear fuel is down roughly 25% in 2016 with the UxC broker average price sitting at $27.50 a pound as of April 25. That’s one of the lowest prices uranium has been in the last decade.
Five years after the Fukushima disaster in Japan, only two of the country’s 50 nuclear reactors are back on line. In other developed markets, such as France and Germany, nuclear power is also in retreat.
Stockpiles at utilities were estimated at an already elevated 217,000 tonnes uranium at the end of 2014. That translates into more than three years’ worth of feedstock for the world’s installed nuclear power capacity.