The Trump administration did not take the action sought by US uranium producers, who said imports were hurting their businesses. Instead, he appeared to favor the interests of US nuclear plant operators, who said trade restrictions might cause economically challenged reactors to shut.The US Department of Commerce, Trump said, found that uranium imports were threatening national security, but the president said he did not agree with the determination. A "fuller analysis of national security considerations with respect to the entire nuclear fuel supply chain is necessary at this time," Trump said.
A White House working group will be established to report on all aspects of the nuclear fuel supply chain and make "recommendations to further enable domestic nuclear fuel production if needed," Trump wrote in his memorandum Friday.
The Ad Hoc Utility Utilities Group, which represented most US nuclear plant operators on the matter, in a statement Saturday welcomed the Trump decision, as did the Nuclear Energy Institute, which represents a broad range of nuclear energy companies.
"Quotas on uranium imports would have a crippling impact on the economic health of the US nuclear fleet," NEI said in a statement Saturday.
The action could mean that uranium production in the US "will effectively disappear," Dustin Garrow, managing principal at consulting company Nuclear Fuel Associates, said in an interview Wednesday when asked to comment on the impact of no action by Trump.
But Garrow also said the decision could bring US utilities, which had largely stopped buying uranium because of the uncertainty about whether use of non-US uranium might be curbed, back to the spot market.
Uranium prices have fallen for much of the year. Prices of U3O8, the most-traded form of uranium, climbed to $25.20/lb at 1 pm Friday, up 36 cents from a week earlier, according to S&P Global Platts. Uranium broker Numerco reported that its uranium bid-offer spread rose Friday afternoon to $25.15/lb-$25.75/lb, with the midpoint up 65 cents from Thursday.
Energy Fuels and Ur-Energy filed a petition in January 2018 under Section 232 of the Trade Expansion Act asking the US Department of Commerce to recommend that Trump require US utilities to secure at least 25% of their uranium from domestic sources for national security reasons. The petition also requested that US government operations that use uranium buy uranium produced in the US.
The two companies said in a statement Saturday they are ready to cooperate with the new working group.
The petition sparked a bitter debate over the need for protection for US uranium miners, with US utilities arguing that any tariffs or quotas would increase their costs at exactly the moment when power prices have made nuclear plants borderline unprofitable. The US utility group said raising the costs of nuclear fuel could spell the demise of a number of nuclear plants.
The petition said that utilities' uranium imports threaten national security, with uranium from state-owned or state-subsidized companies in Kazakhstan, Russia and Uzbekistan filling nearly 40% of US demand while domestic production meets less than 5%.
Commerce sent its recommendations April 14 to Trump, who had up to 90 days from that date to take any action. The recommendations have not been made public, but two nuclear industry sources said in separate interviews June 20 and 21 that one of the options recommended to the president included an initial 5% requirement for US uranium purchases by domestic utilities, gradually rising to 25%.
News reports that Trump would not opt for tariffs or quotas sent US uranium producer stock prices down sharply. Ur-Energy shares declined 34% to 62 cents on the NYSE American stock exchange Friday. Shares of Energy Fuels dropped 37%, closing at $1.93, down $1.11 per share, on the same exchange Friday.