{"id":13337,"date":"2024-12-18T20:53:00","date_gmt":"2024-12-18T20:53:00","guid":{"rendered":"https:\/\/businesstriumphs.com\/index.php\/2024\/12\/18\/uranium-price-forecast-top-trends-that-will-affect-uranium-in-2025\/"},"modified":"2024-12-18T20:53:00","modified_gmt":"2024-12-18T20:53:00","slug":"uranium-price-forecast-top-trends-that-will-affect-uranium-in-2025","status":"publish","type":"post","link":"https:\/\/businesstriumphs.com\/index.php\/2024\/12\/18\/uranium-price-forecast-top-trends-that-will-affect-uranium-in-2025\/","title":{"rendered":"Uranium Price Forecast: Top Trends That Will Affect Uranium in 2025"},"content":{"rendered":"<\/p>\n

The uranium market entered 2024 on strong footing after a year of significant price movement, as well as renewed attention on nuclear energy\u2019s role in the global energy transition.<\/strong><\/p>\n

After a hitting a 17 year high in February, the uranium spot price declined and then stabilized for the rest of 2024, highlighting the fragile balance between supply constraints and growing demand. <\/p>\n

Uranium ended the year around US$73.75 per pound, down from its earlier heights, but still historically elevated. <\/p>\n

Key drivers of 2024\u2019s momentum included geopolitical tensions, particularly US sanctions on Russian uranium imports, and supply-side challenges, such as Kazatomprom\u2019s <\/strong>(LSE:KAP,OTC Pink:NATKY)<\/strong>reduced output. Meanwhile, the energy transition narrative bolstered uranium\u2019s importance as countries sought reliable, low-carbon energy sources. The global push for nuclear energy, amplified by new commitments at COP29, has set the stage for continued growth in demand.<\/p>\n

Heading into 2025, questions about long-term supply security, the geopolitical reshaping of the uranium market and the direction the price will take are expected to dominate industry discussions.<\/p>\n

Investors, utilities and policymakers alike are navigating an increasingly dynamic market, looking to capitalize on nuclear energy\u2019s pivotal role in a decarbonized future.<\/p>\n

\n

Uranium M&A heating up, more expected in 2025 <\/h3>\n

According to the World Nuclear Association, uranium demand is forecast to grow by 28 percent between 2023 and 2030. To satisfy this projected growth, uranium majors will need to increase annual production.<\/p>\n

They can do so by expanding current mines \u2014 if the economics are viable \u2014 or by acquiring new projects.<\/p>\n

The market began to see heightened merger and acquisition activity in 2024, and the trend is likely to continue into 2025 and beyond, according to Gerado Del Real of Digest Publishing.<\/p>\n

He added, \u201cI think it makes sense for some of these bigger companies to start merging and really create a market for themselves, and then take market share for the next several decades.\u201d<\/p>\n

One of 2024\u2019s most notable deals was a C$1.14 billion mega merger that saw Australia\u2019s Paladin Energy (ASX:PDN,OTCQX:PALAF) move to acquire Saskatchewan-focused Fission Uranium (TSX:FCU,OTCQX:FCUUF).<\/p>\n

The deal, which was announced in July, is currently undergoing an extended review by the Canadian government under the Investment Canada Act. Canadian officials have cited national security concerns as a reason for the extension.<\/p>\n

A key factor is opposition from China\u2019s state-owned CGN Mining, which holds an 11.26 percent stake in Fission Uranium. The review reflects heightened scrutiny over critical uranium resources amid geopolitical tensions and global energy security concerns. The prolonged evaluation is now set to conclude by December 30, 2024.<\/p>\n

With no guarantee of approval, both companies are navigating the implications as Canada carefully weighs the acquisition\u2019s potential impact on its domestic uranium sector and national interests.<\/p>\n

Although the Paladin deal remains precarious, it hasn\u2019t impeded other uranium sector transactions.<\/p>\n

At the beginning of Q3, IsoEnergy (TSX:ISO,OTCQX:ISENF) announced plans to buy US-focused Anfield Energy (TSXV:AEC,OTCQB:ANLDF). The deal will significantly increase the company\u2019s resource base to 17 million pounds of measured and indicated uranium, and 10.6 million pounds inferred.<\/p>\n

The acquisition will also position IsoEnergy as a potentially major US producer.<\/p>\n

\u201cWe\u2019ll be looking toward some pretty robust M&A In 2025,\u201d said Del Real.<\/p>\n

Companies weren\u2019t the only dealmakers in 2024. In mid-December, state-owned Russian company Rosatom sold its stakes in key Kazakh uranium deposits to Chinese firms.<\/p>\n

Uranium One Group, a Rosatom unit, sold its 49.979 percent stake in the Zarechnoye mine to SNURDC Astana Mining Company, controlled by China\u2019s State Nuclear Uranium Resources Development Company.<\/p>\n

Additionally, Uranium One is expected to relinquish its 30 percent stake in the Khorasan-U joint venture to China Uranium Development Company, linked to China General Nuclear Power.<\/p>\n

For Chris Temple of the National Investor, the move further evidences the notion that China is using backdoor loopholes to circumvent US policy decisions for its own benefit. <\/p>\n

\u201cChina is selling enriched uranium to the US that\u2019s actually Russian-enriched uranium \u2014 but (China) owns it,\u201d he said. \u201cIt\u2019s the same as when China goes and sets up a car factory in Mexico, and Mexico sells the cars to the US.\u201d<\/p>\n<\/div>\n

\n
<\/div>\n<\/div>\n
\n

Geopolitical tensions to amp up supply concerns <\/h3>\n

Geopolitical tensions are also anticipated to play a key role in uranium market dynamics in 2025. <\/p>\n

In the US, the Biden administration\u2019s Russian uranium ban will continue to be a factor in the country\u2019s supply and demand story. In 2023, the US purchased 51.6 million pounds of uranium, with 12 percent supplied by Russia.<\/p>\n

In response to the Russian uranium ban and other sanctions stemming from the Russian invasion of Ukraine, the Kremlin levied its own enriched uranium export ban on the US in November.<\/p>\n

With a potential shortfall of 6.92 million pounds looming for the US, strategic partnerships with allies will be crucial.<\/p>\n

\u201cIf we take a North American \u2014 and this includes Canada \u2014 (approach), we can find enough supply for the next several years. I am a firm believer that after the next several years of contracts have gobbled up and secured the supply that\u2019s necessary, that we\u2019re just going to be short unless we have much higher prices,\u201d said Del Real.<\/p>\n

Canada is home to some of the largest high-quality uranium deposits, making it a plausible source of US supply. <\/p>\n

Continental collaboration was an idea that was reiterated by Temple.<\/p>\n

\u201cThe biggest beneficiaries, if we\u2019re looking at it in the context of North America, are going to be Canadian companies first,\u2019 he said. \u2018Secondly, some of the US ones that are going to be adding production that have just been idle for years. You\u2019ve got UEC (NYSEAMERICAN:UEC) and Energy Fuels (TSX:EFR,NYSEAMERICAN:UUUU), two that I follow most closely, and they are starting to ramp back up. It\u2019s going to take a while to get there, but they\u2019re going to do well.\u201d<\/p>\n

While Canadian uranium may be the closest and most accessible for the US market, concerns that tariffs touted by Donald Trump could result in a tit-for-tat battle impacting the energy sector have grown in recent weeks.<\/p>\n

Despite the incoming president\u2019s tough rhetoric, both Del Real and Temple see it more as a negotiation tactic.<\/p>\n

\u201cThe cynical part of me doesn\u2019t believe that the tariffs will actually be implemented in any sort of sustainable way, because I\u2019m not a fan. They\u2019re not effective. They\u2019ve been proven to not be effective. They hurt the consumer more than anyone else, and I don\u2019t think that the incoming administration is going to want to start by ramping prices up,\u201d said Del Real, noting that it remains to be seen if the tariff strategy is deployed like a \u201cchainsaw or a scalpel.\u201d<\/p>\n

Temple also underscored the need for diplomacy and unification between the US and Canada.<\/p>\n

\u201cTrump has made a lot of threats about what he\u2019s going to do as far as tariffs and whatnot. But again, his whole tariff policy is using a sledgehammer in multiple places when a scalpel in fewer places is appropriate,\u201d he said.<\/p>\n

He went on to explain that the tariffs are meant to impact China, but the policy is not well targeted. He believes there needs to be more wisdom and nuance in dealing with China, rather than just relying on overarching tariffs.<\/p>\n

More broadly, Temple warned of the potential consequences of pushing China too hard and destabilizing the global economy, a concern he sees as a factor that could be very impactful in 2025.<\/p>\n

China\u2019s economic troubles, driven by an unprecedented debt-to-GDP ratio, are a looming concern for global markets, Temple added. While much of the focus remains on tariff policies, the bigger issue is China\u2019s fragile economic position, with mounting challenges that require more nuanced strategies than punitive measures like tariffs.<\/p>\n

If political tensions escalate \u2014 especially under a Trump presidency \u2014 market confidence could erode further as businesses look to exit China.<\/p>\n<\/div>\n

\n
<\/div>\n<\/div>\n
\n

Resource nationalism, jurisdiction and green premiums <\/h3>\n

Resource nationalism is also seen playing a pivotal role in the uranium market next year. <\/p>\n

As African nations like Niger and Mali look to reshape their domestic resource sectors, uranium projects in those jurisdictions will have a heightened risk profile.<\/p>\n

\u201cI think (jurisdiction) will be critical,\u201d said Del Real. \u201cI think it has been critical.\u201d <\/p>\n

He went on to underscore that with equities currently underperforming, using jurisdiction as a barometer is easier.<\/p>\n

\u201cThe silver lining that I see as a stock picker and somebody that invests actively in the space, is that it\u2019s so much easier for me to pick the companies that are in great jurisdictions when I\u2019m getting a discount,\u2019 said Del Real.<\/p>\n

Africa is an area that Del Real would be cautious about due to a variety of risks, but moving forward supply from the continent is likely to become a key part of the long-term uranium narrative. According to data from the World Nuclear Association, Africa holds at least 20 percent of global uranium reserves.<\/p>\n

For Temple, the scramble to secure fresh pounds could lead to a fractured market. \u201cI think there\u2019s going to be a bifurcation in the world, where eastern uranium is going to stay in the east. Western uranium is going to stay in the west. As we ramp back up and some of what\u2019s in between, maybe including Africa, will get bid over,\u201d he said.<\/p>\n

Adding to this bifurcation could be a green premium on uranium produced using more sustainable methods such as in-situ recovery. This \u201cgreen\u201d uranium could demand a higher price than recovery methods that rely on sulfuric acid. <\/p>\n

\u201cThere is more likely to be a green premium, and beyond a green premium it\u2019s a matter simply of logistics and shipping costs and all of those things \u2014 and, of course, resource nationalism,\u2019 said Temple.<\/p>\n

He also pointed out that globalization is increasingly being reevaluated, with national security and environmental concerns driving a shift toward regional supply chains and localized production.<\/p>\n

Even without recent tariff and trade disputes, the push to reduce dependency on global markets has been growing for years, fueled by legislation like the EU\u2019s distance-based import taxes. <\/p>\n

This trend suggests a premium on domestically produced goods and resources.<\/p>\n<\/div>\n

\n
<\/div>\n<\/div>\n
\n

Experts call for triple-digit uranium prices in 2025 <\/h3>\n

With so many tailwinds building for uranium, it\u2019s no surprise that Del Real and Temple expect the price of the commodity to rise back into triple-digit territory sooner rather than later.<\/p>\n

\u201cI think that inevitably, the spot price is going to have some catching up to do with the enrichment prices, as well as the contract prices,\u201d said Temple. \u201cIt\u2019s a no-brainer that we get back in triple digits sooner rather than later in 2025, and ultimately I think you\u2019re looking easily in the next few years at US$150 to US$200.\u201d<\/p>\n

He cited the rise of artificial intelligence data centers as one of the main price catalysts.<\/p>\n

For Del Real, the spot price has found a new floor in the US$75 to US$80 range, with higher levels to come. <\/p>\n

\u201cI think we\u2019ll finally be at triple digits in the uranium space,\u201d he said. \u201c(It didn\u2019t take a lot of) time to get from US$20, US$30 to US$70, US$80 and then it was a real straight line past the US$100 mark into consolidation,\u201d he said. \u201cI think the utilities are going to start coming offline. And I absolutely see a sustainable triple-digit price in the uranium space for 2025.\u201d<\/p>\n

In terms of investments, both Temple and De Real expressed their fondness for UEC. Del Real also highlighted uranium exploration company URZ3 Energy (TSXV:URZ,OTCQB:NVDEF) as a junior with growth potential.<\/p>\n<\/div>\n

Securities Disclosure: I, Georgia Williams, hold no direct investment interest in any company mentioned in this article.<\/strong><\/p>\n<\/p>\n

This post appeared first on investingnews.com<\/div>\n","protected":false},"excerpt":{"rendered":"

The uranium market entered 2024 on strong footing after a year of significant price movement, as well as renewed attention on nuclear energy\u2019s role in the global energy transition. After a hitting a 17 year high in February, the uranium spot price declined and then stabilized for the rest of 2024, highlighting the fragile balance […]<\/p>\n","protected":false},"author":0,"featured_media":13338,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[],"class_list":["post-13337","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-investing"],"_links":{"self":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts\/13337","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/comments?post=13337"}],"version-history":[{"count":0,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts\/13337\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/media\/13338"}],"wp:attachment":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/media?parent=13337"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/categories?post=13337"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/tags?post=13337"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}