Mine production is increasingly supplemented by ex-military material. World mine production will need to expand significantly post 2005. All mineral commodity markets tend to be cyclical, ie, prices rise and fall substantially over the years, but with these fluctuations superimposed on long-term decline in real prices. In the uranium market, very high prices in the late 1970s gave way to very low prices in the early 1990s, the spot prices being below the cost of production for most mines. In 1996 spot prices recovered to the point where most mines could produce profitably, though they then declined again.
Most trade is long term contracts with producers selling direct to utilities.
The reasons for fluctuation in mineral prices relate to demand, and perceptions of scarcity. The price cannot indefinitely stay below the cost of production, nor will it remain at very high levels for longer than it takes for new producers to enter the market. The capacity is growing slowly, and at the same time the reactors are being run more productively, with higher capacity factors, and reactor power levels. However, these factors increasing fuel demand are offset by a trend for higher burnup of fuel and other efficiencies, so demand is dampened. It is thus likely that the annual demand will grow only slightly to 2010.