Rio Tinto Plc’s Rossing uranium mine, the third-largest worldwide, is likely to miss its 2011 production target because of heavy rains and a strike, External Affairs Manager Jerome Mutumba said.
The output target was 3,100 metric tons for the year, Mutumba said during a media visit to the mine, 70 kilometers (40 miles) inland from the coastal town of Swakopmund.
“We may not be able to meet the production target but we are pushing to do so,” Mutumba said. Rio spokesman Tony Shaffer didn’t immediately return a call seeking comment.
Rossing, which began output in 1976, ships about 7 percent of global supply, according to World Nuclear Association data. Rio owns 69 percent of the operation and the government of Iran owns a 15 percent stake, according to its website.
The spot price for the nuclear fuel has dropped 21 percent since the week before the March 11 earthquake and tsunami wrecked Tokyo Electric Power Co.’s Fukushima Dai-Ichi power station, triggering the worst atomic disaster since Chernobyl in 1986 and prompting some nations to put nuclear plans on hold. Trading is expected to be thin until the end of January, Ux Consoluting Co. said on Nov. 22. Uranium for December delivery closed at $52.50 on Nov. 25 on the New York Mercantile Exchange.
Rio Tinto views the so-called near-term price outlook for uranium as negative as the market remains in surplus until 2014, Mutumba said.
“Spot prices are expected to be volatile and trade around the $50 to $55 range,” he said. “The long-term price outlook remains positive despite Germany’s phasing out of nuclear energy, due to continued China growth. Prices are expected to remain in the $60 to $65 range for now.”