International Investing

1. Demand for nuclear power is increasing - “Some two dozen power plants are scheduled to be built or refurbished during the next five years in Canada, China, several European Union countries, India, Iran, Pakistan, Russia, and South Africa. In the US and the UK, governmental preparations are under way that may lead to 15 new reactor orders by 2007.”

2. Uranium, which powers the plants, is already in short supply -

• Production from world uranium mines now supplies only 55% of the requirements of power utilities.
• Mine production is supplemented principally by ex-military material.
• World mine production will need to expand significantly post 2005.

Accoring to the page I took this really good looking chart from, the previous spikes in supply were related to military buildup. The important part is at the right showing demand far exceeding existing production.

3. Big longer term potential - Going long Cameco provides a lot of ways for the trade to play out. It’s a bet on clean fuel, it’s a bet on international energy demand expansion, and its partial ownership of Centerra Gold gives you a long gold bet as an inflation beater.

A more speculative firm in the uranium mining business is UEX Corporation.

Both firms are long term bets on the price of uranium. The price of uranium is trending up. For now.