13.06.2024 14:50
Climate change and the Russia-Ukraine war have brought nuclear energy back into the spotlight. The search for carbon-free energy and alternatives to Russian energy has driven up uranium prices. Uranium prices have risen by 233 percent in the last 5 years, surpassing gold, silver, and copper.
Uranium, which has a wide range of uses from the development of nuclear weapons to the supply of electricity in nuclear power plants, has made a remarkable leap. After the Fukushima Nuclear Power Plant disaster in 2011, the dangerous substance, which no one preferred for a long time, began to revive with the renewed interest in nuclear energy.
GOLD, COPPER, AND SILVER TRIPLED
With the impact of climate change, governments have renewed their interest in carbon-free energy produced by nuclear power plants, and the search for alternatives to Russian energy due to the Russia-Ukraine war has also increased interest in nuclear energy. The return to nuclear energy has pushed up uranium prices. Uranium prices have risen by 233% in the last 5 years. Thus, uranium's gain has tripled that of gold, silver, and copper.
COMPANY SHARES SOARED
The increase in uranium prices has also affected the shares of companies traded on the stock market. Most of the uranium companies in Canada, which is expected to surpass Kazakhstan as the world's largest uranium producer, have shown an increase of over 400% in the last 4 years. NexGen Energy, a newly established mining company in Saskatchewan, Canada, which is still searching for uranium and does not expect to make sales until 2028, has a market value of nearly $4 billion. The high mineral content of the soil in the Athabasca Basin in Saskatchewan is effective in increasing the market value of the company. The soil is so rich in minerals that some minerals, including NexGen's, need to be diluted before uranium is sold. According to Orest Wowkodaw, a mining analyst at Scotiabank in Toronto, NexGen's mine is expected to account for 13% of global supply.
IMBALANCE OF SUPPLY AND DEMAND INCREASES APPEAL
A large part of the appeal of the uranium business comes from the imbalance between supply and demand. Demand for the metal from China, India, Japan, the US, and Europe is increasing much faster than miners can extract from the ground. According to Treva Klingbiel, the president of TradeTech, which provides data to the industry, demand could exceed supply by more than 100 million pounds per year by the 2030s. Russia's isolation further exacerbates the supply gap. European countries are not only struggling to find alternative fuels to replace Russian natural gas, which powers most of their power plants, but also rely on Russia for raw and enriched uranium.
61 NUCLEAR POWER PLANTS ARE BEING BUILT WORLDWIDE
Today, there are 61 nuclear power plants under construction worldwide, with approximately 90 in the planning stage and over 300 proposed. There is even an effort to reopen old plants that were closed years ago. As new reactors come online, the world's demand for additional uranium ore is also increasing. However, there is also a risk of this boom, like in the past, ending in bankruptcy.
"ANOTHER DEADLY ACCIDENT IS NEEDED TO TEST"
It is stated that the only thing needed to seriously test the newly discovered enthusiasm for nuclear energy is another deadly accident. On the other hand, questions about how and where to dispose of radioactive waste continue to be the most significant weakness in a series of construction initiatives.