Perth-based miner Paladin Energy has put its Kayelekera mine into care and maintenance as sluggish as the price for uranium continues to deteriorate.
The move comes as the spot price for uranium languishes at around $35 a pound.
Paladin said mining would cease at the Malawi operation “until the price of uranium recovers”.
“This decision will preserve the remaining ore body until a sustained price recovery occurs and Paladin determines that production may be resumed on a profitable basis,” the company said.
CEO John Borshoff said the move would be in the long-term interest of all stakeholders.
He said the mine had been operating at a loss despite performing well technically and posting record production results.
The decision will leave many out of work with staff already being asked to leave the site.
The company said workers would receive generous redundancy packages that exceeds Malawi’s minimum legal requirement as well as financial planning advice and training in business skills.
Paladin said its flagship Langer Heinrich mine in Namibia – which is for sale– will not be affected by the move because it has a "significantly" lower cost profile than Kayelekera.
However most analysts are optimistic a turn-around is not far off, with global demand for uranium set to outstrip supply by more than 11,000 tonnes, with most predicting a price rebound by 2017.