2024 Uranium Market: What Are the Biggest Driving Forces?

当前铀周期的“牛气”冲天
Published on: Jan 2, 2025
Author: Caroline Kong

Uranium became one of the most eye-catching commodities for investors in 2024. In January, spot uranium prices surged to a 17-year high of over $100 per pound. The fourth quarter saw the announcement of a uranium export ban in Russia, and six more countries (out of a total of 31) backed a global commitment to triple the world’s nuclear power capacity by 2050 on COP29.

Several major events in the uranium market over the past year have played a crucial role in price movement. By taking a look at these events, investors may be able to get a clearer picture of the uranium prices in 2025.

  1. Biden signs bill banning Russian uranium imports

In May 2024, U.S. President Joe Biden signed a bill banning Russian uranium imports, which would have banned imports of low-enriched uranium (LEU) from Russia. On the eve of Biden’s signing of the bill, the United States imported large quantities of uranium from Russia. In November 2023, Russia became the largest exporter of uranium to the U.S. for the first time, according to data compiled by Rosatom.

From January through November 2023, Russia sold a total of $1.017 billion worth of uranium fuel to the U.S. combined, the highest since 2010. For the entire year of 2022, Russia sold $766 million worth of uranium to the U.S. Currently, more than one-fifth of the enriched uranium fuel for nuclear reactors in the United States and Europe is supplied by Rosatom.

At the same time, the U.S. is moving aggressively to seek alternatives to Russian uranium supplies. In January of this year, the U.S. said it plans to work with allies such as Japan, the U.K. and France to establish an international supply chain for low-enriched uranium.

  1. China approved 11 nuclear reactors, green energy investment amounted to $31 billion

In August, China’s State Council executive meeting decided to approve the construction of 11 nuclear reactors in five provinces of Jiangsu, Shandong, Guangdong, Zhejiang and Guangxi, aiming to further promote the optimization of the energy structure and the sustainable development of the environment through nuclear power generation.

The total investment in the 11 nuclear power units is expected to exceed $31 billion (about 220 billion yuan), and the construction period is expected to last five years. Currently, China has 56 nuclear reactors in operation, generating about 5 percent of the country’s total electricity demand. China is expected to surpass France and the United States as the global leader in nuclear power generation by 2030.

  1. Russia bannedS. uranium exports

On November 15, 2024, the Russian government announced temporary restrictions on the export of enriched uranium to the United States, with the exception of deliveries under one-time licenses issued by the Russian Federal Service for Technology and Export Control. This move is seen as a direct response to the U.S.’s previous ban on imports of Russian uranium products, which not only highlights Russia’s tough stance, but also signals that the global energy market may usher in a new round of volatility and adjustment.

Against the backdrop of the global energy transition, Russia’s restrictive measures may accelerate the investment and development of renewable energy and other clean energy technologies in the U.S. and other countries. This event could be a catalyst to drive the global energy market in a cleaner and more sustainable direction.

  1. U.S. Department of Energy bids to purchase $2.7 Billionof domestic nuclear fuel

The U.S. Department of Energy announced in the second quarter of this year that the U.S. is bidding to purchase up to $2.7 billion worth of domestically enriched uranium, with the goal of strengthening the supply chain for nuclear reactor fuel and reducing reliance on Russian imports of enriched uranium. The move is part of U.S. sanctions against Russia for its full-scale invasion of Ukraine, intended to maintain national security and promote the domestic nuclear industry.

Russia, the world’s largest seller of enriched uranium, has been supplying about 24 percent of the fuel for U.S. reactors. To fill that supply gap, the U.S. Department of Energy plans to award two or more contracts for up to 10 years, depending on the availability of funds. The DOE said the contracts will likely include new enrichment facilities or projects to expand the capacity of existing enrichment facilities, which would present potential business opportunities for U.S. firms such as Centrus Energy and Urenco, a British, Dutch and German joint venture with operations in New Mexico

5. Paladin Energy to buy Fission Uranium for C$1.14 billion

The biggest uranium acquisition news of 2024 was the C$1.14 billion deal announced on June 24 between Paladin Energy (ASX:PDN,OTCQX:PALAF) and Fission Uranium (TSX:FCU,OTCQX:FCUUF). Under the terms of the agreement, Paladin will acquire 100% of the outstanding shares of Fission. Upon completion of the transaction, Paladin shareholders will own 76% of the company’s shares, with Fission shareholders collectively owning the remaining 24%.

Paladin received final approval for the acquisition from the Canadian authorities on Dec. 18, and the transaction officially closed on Dec. 23rd. The combination of the two companies will create a world-class diversified uranium producer operating in multiple countries with a high-quality portfolio of production, development and exploration assets.

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