Nov. 13 (Bloomberg) -- Cameco Corp., the world's largest uranium producer, may temporarily close a uranium-processing plant in Canada because of a dispute over supplies of hydrofluoric acid, used in the production of nuclear fuel.

Cameco is seeking an alternative supplier of the acid, though it doesn't expect to take delivery from a new source until the second half of next year, Lyle Krahn, a spokesman for Cameco, said today in a telephone interview from Saskatoon, Saskatchewan, where the company is based.

The Port Hope, Ontario, plant will run as long as possible using supplies of acid purchased in the spot market, Krahn said. The plant employs more than 450 workers. The dispute centers on increased prices for the acid, used in making reactor fuel.

``No final decision has been made, but if we cannot get enough hydrofluoric acid we will have to shut down the uranium hexafluoride plant and there may be some layoffs,'' Krahn said.

Hydrofluoric acid is used in the conversion of uranium oxide into uranium hexafluoride, a critical step in the fuel- making process.

An adjacent uranium dioxide plant at Port Hope is unaffected by the acid shortage, said Krahn, who declined to identify Cameco's current acid supplier or to say how much the price has increased.

Cameco rose C$1.35, or 7.8 percent, to C$18.70 at 4:18 p.m. in Toronto Stock Exchange trading. The shares have fallen 53 percent this year.

To contact the reporter on this story: Christopher Donville in Vancouver at cjdonville@bloomberg.net.

Last Updated: November 13, 2008 17:56 EST