Cameco “pleased” with Trump’s uranium decision
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Cameco “pleased” with Trump’s uranium decision

Last weekend, President Trump overruled his commerce department, deciding not to impose any new trade restrictions over nuclear fuel imports into the US. That’s a positive twist for a sector that’s had the threat of trade issues hanging over its head since last summer, when the US government said it would be investigating the national security implications of importing foreign uranium. And, while uncertainty persists, no one is more pleased than Cameco, the world’s largest publicly traded uranium company.

Cameco’s share price was more or less flat last week

Cameco July 23

Source: Yahoo Finance

Jeff Hryhoriw, a Cameco spokesman, gave the company’s view on Mr. Trump’s decision: “We really didn’t have a prediction as to how this would all turn out. We’re pleased that there’s not going to be any new trade restrictions applied against uranium imports by the United States. We’ve always contended that uranium supplied by Cameco or Canada … has never been a threat to U.S. national security.”

Added tariffs would have hit Cameco, which is based in Saskatoon, Canada, hard. The US is its largest market, and utilities in the country accounted for 25% of its sales last year. The current unease began a year ago, when two American uranium companies expressed concern over the fact that the US imports 93% of its supply.

On the Friday before last, Mr. Trump issued a memorandum saying that US Secretary of Commerce Wilbur Ross told him uranium is now being imported into the US “in such quantities and under such circumstances as to threaten to impair national security.” Trump, however, disagreed, following up with his own opinion: “at this time, I do not concur with the Secretary’s findings that uranium imports threaten to impair the national security of the United States as defined under section 232 of the (Trade Expansion) Act.”

Hryhoriw said: “We’re certainly hopeful that we may see an increase in (uranium sales contracting) going forward from U.S. utilities who have been reluctant to lock into long-term contracts up until this point, but it’s really difficult to predict for certain. While some uncertainty will remain until the efforts of the working group are complete, the president’s decision is overall a positive outcome.”

Disclosure

Dominion holds Cameco in its Global Trends Managed Fund.


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