PRODUCTION from Energy Resources of Australia's Ranger uranium mine is expected to be down as much as 18 per cent in 2010.

Forecast full-year production was downgraded from a previous view in line with 2009's level of 5,240 tonnes of uranium ore to 4,300-4,700 tonnes, ERA said.

The company blamed the fall on working through low ore grades, higher-than-expected rainfall that prevented access to the lowest levels of the mine and stability problems with the south wall of the mine.

ERA shares fell on the news, losing 60 cents, or 4.1 per cent, to $14.13.

The production downgrade was "well below what they've stated before", said Neil Goodwill, a mining analyst at Goldman Sachs JBWere.

ERA's Ranger mine is the world's third-biggest producer of the heavy metal used in nuclear reactors and by the military, after BHP Billiton Olympic Dam in South Australia state and Rio Tinto's Rossing mine in Namibia.

Rio owns 68 per cent of both ERA and Rossing.

ERA reported that uranium oxide production over the past three months at the site was down 7 per cent on the first quarter and 44 per cent on the second quarter last year, although the volume of material was up 40 per cent on the previous quarter and down 54 per cent on year as the open-pit mine worked through lower ore grades.

Sales will remain "somewhat in excess of 5,000 tonnes" during 2010 due to inventory management, shipment flexibility, and secondary purchases, the company said, and July will see a return to the lower levels of the mine previously blocked by rainwater.

RBS analyst Lyndon Fagan said that two-thirds of the company's 2010 production was already expected to be skewed towards the second half of the calendar year and added that while RBS would downgrade ERA's full-year production figures, sales still looked in line.

Even so, "we see no reason to be in uranium stocks at the moment", he said, joining Goldman Sachs JBWere in putting a 'hold' rating on the stock.