The nuclear industry will emerge stronger and safer after the accident in Japan this year, and demand by energy-hungry emerging nations mean a shortfall of uranium will widen, Uranium Energy Corp Chief Executive Amir Adnani said.

"I think it's good that there is such a strong focus on safety now, and reviewing protocols as a result of what happened in Japan," Adnani told Reuters in an interview.

"And I think at the end of the day when you look at supply and demand for uranium, the world still consumes more uranium than we mine." The world's worst nuclear accident in 25 years at Japan's quake-hit power plant in March triggered deep public distrust.

Germany permanently suspended eight of its 17 reactors as part of plans for a complete nuclear power phase-out by 2022.

But emerging nations' plans to build nuclear reactors for energy supply remain unchanged, with China the main engine of growth.

"About half of nuclear reactors under construction are in China," Adnani said.

"South Korea, India, Russia...the countries that need nuclear power the most are the emerging economies, or the economies that are growing most rapidly."

On Wednesday French Energy Minister Eric Besson told Reuters France still plans to build a 60th nuclear reactor at home, and is eyeing possible deals for plants in Europe and emerging countries, with China and India the biggest markets for new nuclear projects.

"We have to realise that reactors that are 40 years old are from a totally different technological generation," Adnani said.

"The new generation reactors being built, especially incorporating lessons from Fukushima, will be more effective." The industry faces a shortfall in uranium to power around 425 nuclear reactors that are still operating post Fukushima.

Annual global consumption of uranium is about 170-175 million pounds, and mine production is roughly 130-135 million pounds per year, Adnani said.

That 40 million pound gap is set to widen to around 60 million pounds per year as secondary supplies from civilian and military inventories dwindle.

But any new investment in mining is being hampered by the uranium price, which has fallen around a quarter since early March.

Spot uranium is currently trading at around $52.

"With all the market turbulence we may not see any financial players enter the physical uranium market, which in the past has always been the catalyst to get the prices moving," Adnani said.

"My expectation is we see it getting up to $60 per pound, going into 2012.

We really need to see prices move higher before the uranium industry can explore and build more inventory.

I think the price has to get up to $85 to $90 level," Adnani said.

Copyright Reuters, 2011

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