A market-clearing model of the uranium and enrichment industries

A market-clearing model of the uranium and enrichment industries through 2030 is presented. Built around thorough databases of primary and secondary uranium supplies as well as enrichment facilities, the model derives market-clearing conditions by locating the intersections between the annual supply-and-demand curves for uranium and enrichment services. Considering the effects of secondary supplies including highly enriched and natural uranium inventories along with depleted uranium enrichment, the model solves embedded optimization problems to account for trade-offs between uranium and enrichment requirements. The model can inform policy decisions tied to uranium inventory management and sale and market effects of purchase and disburse-ment from a uranium bank. This paper documents the methodologies behind the model, describes a stochastic implementation to propagate uncertainties, and contrasts its forecasts to static projections. Further, it is applied to an illustrative reference case featuring moderate (2.6%/yr) demand growth for reactor fuel. The model predicts near-level uranium prices with declining separative work unit prices and enrichment tails assays through the mid-2020s. This behavior is largely driven by the coming online of several new centrifuge enrichment plants and capacity expansions at others, which encourages more aggressive tails assays while suppressing uranium requirements.