THE EDITORIAL PAGE Uranium protectionism aids the few

Just when the Canada-U.S. free trade talks appear to be entering their final climactic phase, U.S. uranium producers, supported by local politicians, have won a major protectionist victory. In Colorado, the court has ruled in favor of a group of southwestern U.S. uranium producers banning all foreign uranium from being enriched in the U.S.

For Canada, the largest producer of uranium in the world, the consequences of the decision, if upheld by appeal, will be devastating. In Saskatchewan, which sells almost half of its entire uranium output to our southern neighbour, more than 3,000 uranium jobs are at risk — including almost one thousand jobs at the Saskatchewan Mining Development Corp, the provincially- owned company. In the U.S., the burden of this rash action will fall, as usual, on the consumer, who will foot the bill for increased electrical power. This coming from utilities being forced to buy much more expensive uranium from the protected producers.

A threat such as this then, demands a concerted and collective defence from not only the Canadian uranium industry, but from government as well. The beneficiaries of the decision, the U.S. uranium producers, represent a relatively small industrial group within that country. Yet their blatant protectionist action, which finds support in an archaic piece of 1940s legislation requiring that the U.S. have a viable uranium industry, hurts the majority while protecting the minority.

Let’s face reality. In a uranium market which sells the material for $17(US) per lb, no American mine is economic considering their abysmally low grades. (In Saskatchewan, grades range up to 30% at Cigar Lake, compared to average U.S. grades of 0.1% uranium oxide per ton). Although Canadian uranium miners are making a buck at these prices, few others can.

Protectionism, if anything, merely highlights the obvious deficiencies and inefficiencies of the U.S. uranium industry. Artificially propping up the industry for regional interests will make the industry viable. But the quest for viability will result in costs to the many, far outweighing any benefits accruing to the few.