Lehman Brothers Sitting on a Stockpile of Uranium 'Yellowcake'

[Magda Hassan]

Toxic assets of a different kind. I wonder how many others are in the same situation?


Strange that the Guardian chose a picture of those evil Iranians to illustrate a Lehman Brothers stuff up. Why not Sellafield?


Lehman Brothers Sitting on a Stockpile of Uranium 'Yellowcake'

Lehman's nuclear stockpile is a hangover from a trading contract undertaken before the Wall Street bank collapsed last year

by Andrew Clark

The rump of the bankrupt bank Lehman Brothers is sitting on a stockpile of 450,000 lb of uranium "yellowcake" which could be used to power a nuclear reactor or, theoretically, to make a bomb.
Technicians at Isfahan handle a barrel of yellowcake uranium. (Reuters)
Lehman's potentially explosive asset is a hangover from a commodities trading contract undertaken before the Wall Street bank went bust in September. The substance, yellowcake, is a solid form of mined uranium which is yet to be enriched.Liquidators have been trying to offload the stuff for months. But the price of uranium has been dropping steadily, leaving Lehman's yellowcake languishing in a variety of secure storage facilities, some of which are in Canada.
Bryan Marshal, Lehman's chief executive, who was appointed to salvage value for creditors, told Bloomberg News that the stockpile, which is worth about $18m, would be sold responsibly.
"We plan on gradually selling this material over the next two years," he said. "We are not dumping this on the market and have no fire-sale mentality."
The price of uranium has slumped from $65 per pound to $40.50 over the last six months as pressure on recession-hit commodity investors to liquidate their assets has eased.
Yellowcake can be purified and enriched to fuel nuclear reactors or, notionally, weapons. A lively financial market in uranium trading has developed in recent years. While commodities such as oil and precious metals are dealt in futures contracts which rarely see delivery, the relative immaturity of uranium trading means that trading firms sometimes end up taking ownership of the stuff.
"Uranium is a liberalising marketplace. It's not as mature as most other exchange-traded commodities," said Scott Lawrence, head of nuclear fuel trading at MF Global in London. "It's certainly not unusual for a wide range of parties to have legal title to the material."
Lehman's ownership is governed by tight regulations. Its yellowcake must be stored at licensed facilities and the substance cannot be transported around freely. One trader said: "They're not holding it in Canary Wharf. There are very strict rules about what you can do with it."
Some 43m lb of yellowcake was sold on the spot market last year. Market participants say Lehman tried to sell its stockpile in one block but was unsuccessful and may try to sell it on a piece-by-piece basis instead.
Lehman's brokerage operation was bought in September by Barclays Capital, which took on about 10,000 of the bankrupt firm's staff. The remaining chunk of Lehman has outstanding debts estimated at $200bn.
http://www.guardian.co.uk/business/2009/...ar-weapons

[Peter Lemkin]

Toxic assets of a different kind. I wonder how many others are in the same situation?


Strange that the Guardian chose a picture of those evil Iranians to illustrate a Lehman Brothers stuff up. Why not Sellafield?


Lehman Brothers Sitting on a Stockpile of Uranium 'Yellowcake'

Lehman's nuclear stockpile is a hangover from a trading contract undertaken before the Wall Street bank collapsed last year

by Andrew Clark

The rump of the bankrupt bank Lehman Brothers is sitting on a stockpile of 450,000 lb of uranium "yellowcake" which could be used to power a nuclear reactor or, theoretically, to make a bomb.
Technicians at Isfahan handle a barrel of yellowcake uranium. (Reuters)
Lehman's potentially explosive asset is a hangover from a commodities trading contract undertaken before the Wall Street bank went bust in September. The substance, yellowcake, is a solid form of mined uranium which is yet to be enriched.Liquidators have been trying to offload the stuff for months. But the price of uranium has been dropping steadily, leaving Lehman's yellowcake languishing in a variety of secure storage facilities, some of which are in Canada.
Bryan Marshal, Lehman's chief executive, who was appointed to salvage value for creditors, told Bloomberg News that the stockpile, which is worth about $18m, would be sold responsibly.
"We plan on gradually selling this material over the next two years," he said. "We are not dumping this on the market and have no fire-sale mentality."
The price of uranium has slumped from $65 per pound to $40.50 over the last six months as pressure on recession-hit commodity investors to liquidate their assets has eased.
Yellowcake can be purified and enriched to fuel nuclear reactors or, notionally, weapons. A lively financial market in uranium trading has developed in recent years. While commodities such as oil and precious metals are dealt in futures contracts which rarely see delivery, the relative immaturity of uranium trading means that trading firms sometimes end up taking ownership of the stuff.
"Uranium is a liberalising marketplace. It's not as mature as most other exchange-traded commodities," said Scott Lawrence, head of nuclear fuel trading at MF Global in London. "It's certainly not unusual for a wide range of parties to have legal title to the material."
Lehman's ownership is governed by tight regulations. Its yellowcake must be stored at licensed facilities and the substance cannot be transported around freely. One trader said: "They're not holding it in Canary Wharf. There are very strict rules about what you can do with it."
Some 43m lb of yellowcake was sold on the spot market last year. Market participants say Lehman tried to sell its stockpile in one block but was unsuccessful and may try to sell it on a piece-by-piece basis instead.
Lehman's brokerage operation was bought in September by Barclays Capital, which took on about 10,000 of the bankrupt firm's staff. The remaining chunk of Lehman has outstanding debts estimated at $200bn.
http://www.guardian.co.uk/business/2009/...ar-weapons

Hey, lets all chip-in and buy some Plutonium on the spot market!* (I don't think I have the funds for much myself - don't know the going price, but can't be cheap!) Can only appreciate in value as the World goes to hell in a handbasket. I wonder how many firms, banks, investors, rich trade in commodities like Plutonium, drugs, weapons systems, etc. I'd guess many to most. When one enters the world of Anglo-American-style Corporate Capitalism and Finance one leaves morality outside the door (Like where I live everyone does with their shoes). Just a social custom in the community. :bootyshake:

* There appears to be little information on the price, but I've seen estimates [old] of about 15,000$/Kg and above. Pricey. Not legal to buy, but who knows if one can trade it without taking possession....one Russian was arrested here a few years back for having quite a lot in his briefcase....I wonder what ever happened to him and his biological damage from the radiation too.