Uranium Demand Surges Amid Global Nuclear Power Expansion
The global uranium market is experiencing a significant surge in demand, driven by nations’ plans to expand their nuclear power capacity. Leading research firms predict that the current rise in uranium prices will continue, with the US and 20 other countries aiming to triple their nuclear power capacity by 2050. China is at the forefront of this nuclear building race, currently constructing 22 of the 58 global reactors, while Japan has also restarted projects to build reactors.
The renewed interest in nuclear power is particularly evident in eastern Europe, with the Czech Republic expanding its nuclear energy capacity, and reactor life extensions and restart projects underway in Japan and Canada. Statista forecasts that global uranium demand will reach 209 million pounds by 2035, indicating a need for new assets to fill the supply gap.
Supply Chain Uncertainty and Russian Ban Impact
The global uranium supply chain faces uncertainty following the US ban on Russian nuclear fuel imports. Russia supplies a quarter of the US nuclear fuel and half of the global supply, and the impact of the ban is being assessed. European utilities have already shunned Russian supply following the invasion of Ukraine in 2022, further contributing to supply chain challenges.
The Office of Australia’s Chief Economist predicts that price pressures will persist until 2026, with the price settling at around US$99 a pound. Australian uranium exports, produced at the Four Mile and Olympic Dam mines in South Australia, are expected to grow, with export values projected to increase from $1.3 billion in 2023-24 to $1.7 billion by 2025-26. The newly-reopened Honeymoon mine by Boss Energy is also expected to contribute to Australia’s export earnings.
Sources: Statista, Office of Australia’s Chief Economist (April 2023)
