{"id":4346,"date":"2024-11-15T07:01:15","date_gmt":"2024-11-15T06:01:15","guid":{"rendered":"https:\/\/a2kadvisory.com\/?p=4346"},"modified":"2024-11-15T07:16:09","modified_gmt":"2024-11-15T06:16:09","slug":"uranium-price-to-recover-next-year-on-shortage-trump-policy-sprott-ceo-says","status":"publish","type":"post","link":"https:\/\/a2kadvisory.com\/fr\/2024\/11\/15\/uranium-price-to-recover-next-year-on-shortage-trump-policy-sprott-ceo-says\/","title":{"rendered":"Uranium price to recover next year on shortage, Trump policy, Sprott CEO says"},"content":{"rendered":"
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Uranium\u2019s spot price doesn\u2019t adequately reflect demand from nuclear power plants, Sprott says. Credit: Adobe Stock photo by pwmotion<\/p><\/div><\/div><\/div><\/div><\/div>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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The price of uranium will rebound from its lowest level in a year as supply shortages, nuclear energy\u2019s promise for clean energy and president-elect Donald Trump\u2019s America-first security stance provide support, the world\u2019s largest investment fund in the physical metal says.<\/p>

\"\"The heavy metal\u2019s spot price fell to $76.56 per lb. this week, down from a 17-year high of $106 per lb. in February. But it should recover to between $90 and $100 a lb. by about June, according to John Ciampaglia, CEO of Sprott Asset Management. He runs the $5.1 billion\u00a0Sprott Physical Uranium Trust\u00a0(TSX: U.U for USD; U.UN for CAD).<\/div>

The United States and other Western nations such as Canada, Australia and Namibia are restarting or ramping up production of uranium oxide. Yet, it\u2019s nowhere near enough to meet just the 50 million lb. a year needed to power US nuclear power plants. Output from global leader Kazakhstan has been hampered by\u00a0sulphuric acid shortages. The West is attempting to limit uranium supplies from pariah Russia, which controls some 40% of the world\u2019s capacity to enrich uranium into fuel.<\/p>

\u201cWhat Trump will continue to do is support local industry in the name of national security and reshoring, and that obviously has implications right across the whole nuclear fuel supply chain,\u201d Ciampaglia said in an interview on Friday with\u00a0The Northern Miner<\/em>. \u201cCanada will be a huge winner here as we restart uranium projects and build new uranium mines.\u201d<\/p><\/div><\/div><\/div><\/div><\/div><\/div><\/div><\/div><\/div><\/div><\/div>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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Utilities defer<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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However, utilities, which buy the majority of their uranium in long-term contracts, haven\u2019t been stocking up on supplies during the supply shortage as much as Ciampaglia expected. Even some miners such as\u00a0Cameco\u00a0(TSX: CCO; NYSE: CCJ) have had to buy uranium on the spot market to meet utility supply contracts when production fell short. The needs for some 60 new nuclear plants under construction aren\u2019t reflected in the spot price, he said.<\/p>

\u201cWe\u2019re a little bit confused sometimes around the utility behavior,\u201d he said. \u201cWe would have thought that their urgency to buy more uranium would be higher, given the risks to the supply chain, given some of the production challenges with the restarts and given the long timelines to get new mines online. The market over the next four to six years is going to be very supply challenged.\u201d<\/p>

He said the price fell this year over uncertainty about the US Congress passing an import ban in August against Russian enriched uranium. However, it doesn\u2019t take effect until 2028 and some utilities may wait to see if Russia-friendly Trump cuts a deal with President Vladimir Putin to lift the sanctions.<\/p>

\u201cEnergy security is driving a lot of the energy policy, so we\u2019re really bullish on uranium,\u201d Ciampaglia said, adding that the US depends on nuclear for 19% of its power. \u201cThat price correction we\u2019ve had in uranium this year is very overdone.\u201d<\/p>

Trump\u2019s avowed stance to impose tariffs on all kinds of global trade and Putin\u2019s own threat in September to retaliate against the West with sanctions on uranium, nickel and palladium complicates matters. Yet, energy security will be the driving force, the CEO said.<\/p>

\u201cThe US Department of Energy wants to force users in the US to shift to domestic sources, given this capacity that\u2019s being built is very, very expensive,\u201d Ciampaglia said. \u201cThey want that capacity to be filled through long-term contracts with the new capacity being scaled.\u201d<\/p><\/div><\/div><\/div><\/div><\/div>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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Uranium demand has more catalysts to rise as energy-hungry artificial intelligence spreads among tech giants Alphabet, the parent of Google, Amazon, Oracle and Microsoft.\u00a0They\u2019ve all\u00a0bought property near nuclear plants, or made long-term power deals and expressed interest in the development of small nuclear reactors (SMRs).<\/p>

\u201cIt\u2019s really interesting that big tech with very deep pockets of capital are really stepping up to the plate and acknowledging that they just can\u2019t fund the building of new solar and wind farms to power these AI data centres,\u201d Ciampaglia said. \u201cThey also need firm clean power coming from large-scale reactors.\u201d<\/p>

Microsoft announced a 20-year power purchase agreement with Constellation Energy in September. It includes nuclear power from the Crane Clean Energy Center and the restart of Three Mile Island Unit One. French state nuclear company Orano chose Tennessee in September to build an enrichment plant and its expanding another in southern France. Urenco, a British-Dutch-German nuclear fuel consortium, is expanding a site in New Mexico.<\/p><\/div><\/div><\/div><\/div><\/div>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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Projects due<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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One the production side, Cameco has been ramping up production at the MacArthur River and Key Lake mines in Saskatchewan. The plants were idled when uranium prices were low before the surge of green energy investments to limit climate change.\u00a0Denison Mines\u00a0(TSX: DML; NYSE: DNN) and\u00a0NexGen Energy\u00a0(TSX: NXE; NYSE: NXE; ASX: NXG)\u00a0are progressing their advanced-stage Wheeler and Rook I projects, respectively.<\/p>

Even so, the projects are years if not a decade away from producing. Also, the Canadian government has launched\u00a0a national security review\u00a0of\u00a0Paladin Energy\u2019s (ASX: PDN) proposed C$1.1 billion takeover of Saskatchewan uranium developer\u00a0Fission Uranium\u00a0(TSX: FCU).<\/p>

Meantime, Cameco and Kazakhstan\u2019s\u00a0Kazatomprom\u00a0(LSE: KAP), in a joint venture on the Inkai mine in the central Asian country, said this month it was performing about 20% below expectations.<\/p>

Likewise, south of the border companies such as\u00a0Uranium Energy\u00a0(NYSE-AM: UEC) and\u00a0Energy Fuels\u00a0(NYSE: UUUU; TSX: EFR)\u00a0are reopening sites\u00a0in Wyoming, Texas, Arizona, and Utah after years of inactivity.<\/p><\/div><\/div><\/div><\/div><\/div>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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But Energy Fuels\u2019 Canyon project near the Grand Canyon has faced delays due to regulatory challenges, environmental opposition and legal battles with groups concerned about its impact on the nearby national park and groundwater.\u00a0EnCore Energy\u2019s (TSXV: EU; NASDAQ: EU) Dewey Burdock project in South Dakota and Uranium Energy\u2019s Sheep Mountain project in Wyoming have faced similar hurdles.<\/p>

The Sprott Physical Uranium Trust\u00a0raised about C$65 million to C$70 million in new equity in the last six weeks or so, the CEO said. It\u2019s prepared for another September-to-May period when more long-term contracting tends to occur, he said.<\/p>

\u201cAfter having a little bit of a low, given all the distractions, we\u2019re just going to get back into another up period,\u201d he said. \u201cWe\u2019d love to get back to buying more uranium.\u201d<\/p><\/div><\/div><\/div><\/div><\/div>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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Source : mining.com<\/a><\/p><\/div><\/div><\/div><\/div><\/div>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<\/div>","protected":false},"excerpt":{"rendered":"

Uranium\u2019s spot price doesn\u2019t adequately reflect demand from nuclear power plants, Sprott says. Credit: Adobe Stock photo by pwmotion The price of uranium will rebound from its lowest level in a year as supply shortages, nuclear energy\u2019s promise for clean energy and president-elect Donald Trump\u2019s America-first security stance provide support, the world\u2019s largest investment fund […]<\/p>","protected":false},"author":1,"featured_media":4351,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"set","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center 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Uranium price to recover next year on shortage, Trump policy, Sprott CEO says<\/a><\/blockquote>