Uranium production from the world's largest uranium producer Kazakhstan-based Kazatomprom fell slightly in the first quarter of 2020 due to reduced operations from the COVID-19 pandemic, the company said Monday.
According to the company's statement, the company's production fell to 5,221 tons uranium (tU) from 5,294 tU in the first three months of 2019.
In April, the company announced that operational activities across all uranium mine sites in Kazakhstan would reduce for an anticipated three-month period to minimize the risks posed by the COVID-19 pandemic.
With measures in place for about three months, a lower level of well-field development activity is expected with a corresponding reduction in production volumes, the statement said.
"In total, the mine curtailments and suspensions related to COVID-19 are expected to push the supply-demand balance to an annual deficit for 2020. Third-party estimates indicate primary uranium supply could decrease by more than 10% compared to 2019, which was a year when supply-demand was generally in balance," the company said.
On April 7, Kazatomprom lowered its uranium production volume forecast for 2020 by up to 4,000 tU to 19,000-19,500 tU compared to the previously forecast volumes of 22,750-22,800 tU due to measures introduced to comply with COVID-19 lockdown requirements.
However, the company underlined that the reduced production level is not expected to impact Kazatomprom's 2020 sales.
According to the company, as the duration and the full impact of the COVID-19 pandemic is not yet known, it is assumed that a reduced staff level at the operations will remain in place for a period of three months. Therefore, annual production volumes could vary from the company's expectations.
On Dec. 4, 2017, the company announced that starting from January 2018 it would cut uranium production by 20% over the next three years, as the market struggles with oversupply, which has led to lower prices.
The company said that there are no plans to make up lost production, as it remains "committed to its market-centric strategy and in 2021, production is expected to remain 20% below subsoil use agreement levels."
By Firdevs Yuksel