Germany’s government said on Monday that it plans to shutter all of its nuclear reactors by 2022 in response to Japan’s Fukushima disaster. But commodity experts tell BNN that Germany’s decision will have very little effect on the global nuclear industry and the future of nuclear power.
“Going forward, the outlook for nuclear power and uranium is going to be most dependent on emerging market growth,” Patricia Mohr, VP Economics at Scotiabank, tells BNN. “An official from China’s nuclear association recently said they were still expecting 70 gigawatts of nuclear power by 2020, which is not very far off from the kind of projections we would have made prior to the Fukushima incident in Japan.”
John Goldsmith, Portfolio Manager at Montrusco Bolton, also believes that China will have to rely on nuclear power to satisfy the energy needs for its fast-growing economy.
“China did the politically correct thing after this disaster, saying there were going to… slowdown the approval of any new projects, but they never said that there were going to halt plants that were already in construction,” he says. “They do not have the energy requirements that they need to satisfy the demands from their economy going forward. Clearly nuclear is going to play an incredibly important role.”
And David A. Talbot, an analyst at Dundee Securities, says investors should take Germany's decision in stride.
"We believe that investors in the uranium sector should stay the course—that the long term fundamentals remain very strong for the sector—despite Germany's decision to opt out," he wrote in a research note to clients.