Nukes Are Back, but Uranium Is in Short Supply
A renaissance for the nuclear-power industry has run into a problem: Prices have soared for the radioactive uranium required to fuel reactors in the decades ahead. New reactors have connected to the grid in the U.S., Asia and Europe, while the lifetime of existing plants has been extended. Japan is bringing power stations that were closed after the 2011 Fukushima disaster back online.
And small modular reactor projects, involving companies such as General Electric and Rolls-Royce, have taken steps toward commercial viability. The nuclear comeback has jolted the $10 billion uranium market after a decadelong bust that deterred mining companies from producing the fuel. There are pinch points along the complex supply chain, from mining to enrichment.
Some worry that the West will eventually sanction fuel from Russia, the world’s largest enricher of uranium. Adding to the angst: the recent coup in uranium-rich Niger. The West African country accounts for roughly 5% of the global uranium supply and 24% of European Union imports, according to Morgan Stanley analysts.
France’s huge nuclear-power fleet is particularly dependent. Traders fear potential disruption to shipments and delays to new projects. Benchmark prices have jumped 30% this year to about $62 a pound, according to market-data firm UxC, making uranium one of the top-performing commodities.
Barring a surge last year after Russia’s invasion of Ukraine, that is their highest level since 2011, when the Fukushima meltdowns led to the shutdown of dozens of reactors. “The market is now needing new production again, but the lead times for that to happen will not occur quickly or easily," said Amir Adnani, chief executive of Texas-based Uranium Energy, an aspiring miner. The
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