* Uranium heading for China goes through Almaty
* China has large stockpiles of the nuclear fuel - CRU
LONDON, Jan 7 (Reuters) - Protests in Kazakhstan have not
hit the country's uranium output so far, but if the crisis
escalates and transport is disrupted, shipments of the fuel used
to generate nuclear power from the dominant producer will be at
risk.
Days of violent unrest against a fuel price hike have
prompted the government to declare a state of emergency in
Kazakhstan, with soldiers shooting at protesters in its biggest
city Almaty on Thursday.
The country is the world's top uranium producer, accounting
for around 40% of global supplies estimated at 50,000 tonnes a
year. An assessment by S&P Global Platts showed uranium prices
had risen 8.3% since Tuesday to $45.75 a lb on Thursday, the
highest since Nov. 30.
Miners and analysts say inventories and idled capacity that
could be restarted are expected to limit any price rallies.
Kazatomprom , the world's biggest uranium
producer, said on Thursday it was operating normally with no
impact on output or exports. CRU analyst Toktar Turbay said
Kazakhstan's uranium mines are mostly in the Turkestan region,
far away from where the protests are happening.
But concern remains about how producers will get material
from mines to end-users. Around half of the uranium produced in
Kazakhstan is shipped to China, with the rest going to other
markets including Europe and Canada.
"Transport could pose a hurdle, as material heading for
China travels through Almaty," Turbay said.
China however has been adding to its uranium reserves and
holds more than 10 years of consumption at current levels.
Turbay estimates China has stockpiled 120,000 tonnes of uranium
over the last 10 years.
China's state stockpiler did not immediately respond to
requests for comment.
Uranium heading for Europe or Canada typically goes through
Russia and the Black Sea, which avoids the Almaty region.
Market sources say capacity idled because of low prices
could be restarted to keep the market supplied.
This includes capacity at Canada's Cameco, which
said on Thursday it could resume production of roughly 24
million lbs of uranium annually in North America if needed by
the global market.
U.S.-based Energy Fuels Inc said it could start
producing 500,000 lbs of uranium annually within six months if
prices for the nuclear fuel rise due to the political unrest in
Kazakhstan.
"Concern is focused on the ability to transport uranium out
of the country," said William Freebairn at S&P Global Platts.
"Utilities are generally conservative about their uranium
purchasing and they secure material from a variety of geographic
regions and have strategic inventories in order to reduce this
kind of geopolitical risk."
(Reporting by Pratima Desai; Additional reporting by Min Zhang
in Beijing and Ernest Scheyder in Houston; Editing by Jan
Harvey)