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Is Uranium an investment in the future?

Team Veye | 07 Feb 2022

Is Uranium an investment in the future?

Many countries are having Uranium deposits but not all deposits can be recovered economically. However, prevailing uranium prices play an important role in deciding whether a deposit is economically viable.

Kazakhstan, Canada and Australia produce nearly 70% of the world’s uranium. But countries with low cost recoverable sources have an advantage when it comes to uranium production.

Uranium has experienced a wide price range this past century — while its highest level was nearly US$140, the lowest U3O8 spot price came in at just US$7.

In the recent times, the global importance of decarbonisation and electrification has been increasing continuously and substantially. Both require carbon free nuclear power to achieve stated goals as it is central to the clean energy transition.

Nuclear power is on the global agenda and it can be said with some certainty that the goal of Net zero emissions by 2050 cannot be achieved without nuclear. Nuclear provides reliable baseload power. The world’s nuclear reactors will require an increasing supply of uranium.

Uranium prices have been suppressed for over 10 years. Many uranium projects have remained uneconomic at current uranium prices. Industry experts believe that the uranium market cycle has reached its bottom and that a break to the upside for uranium prices is supported by positive supply and demand fundamentals.

The demand for electricity is only going to keep rising and the global push towards green energy continuing to grow stronger as climate change’s effects become more obvious, the demand for nuclear power is going to surge. Uranium price can have the potential to rise significantly to incentivise uranium production.

A uranium investment isn't just sound fiscal decision-making, it's an investment in the future of the planet.

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