Since the Fukushima accident in 2011, uranium prices have declined, forcing many miners to stop or reduce their operations. However, nuclear power’s increasing role in the transition to clean energy and a shortage of supplies could improve the situation for the uranium industry.
The Uranium Supply Chain
Uranium is found in mines all over the world, as well as in commercial and military stockpiles. Uranium is not evenly distributed throughout the Earth’s crust, with some areas having higher concentrations than others. Not all of these deposits are economically viable to mine, however, as it depends on the price of uranium. Some countries have uranium resources that can be mined at a profit when prices are low, while others do not.
Kazakhstan has a lot of uranium that can be extracted cheaply, while Australia has more uranium overall but is more expensive. This affects how much uranium each country produces. Kazakhstan produced about a third of the world’s uranium in 2018, even with the suspension of the McArthur River Mine, the largest uranium mine in the world. Australia is the third-largest producer of uranium, with only two operating mines.
The market price of uranium is important in determining the commodity’s overall supply. Although production figures provide some insight into the total amount of uranium available, the market price can significantly impact the amount of uranium that is actually supplied to the market. When the price of uranium is high, miners are more likely to bring their product to market, but when the price is low, they may choose to hold onto their uranium or sell it at a loss.
How Uranium Prices Affect Supply
Uranium prices have been low for over a decade, which has had a twofold effect on uranium supply. Firstly, many uranium mines have been closed due to low prices, which has led to a decrease in uranium production. Secondly, the low prices have made it uneconomical for companies to stockpile uranium, so there will be less uranium available for use in the future.
The secondary supply of uranium, recycled from used nuclear fuel, has also been reduced for the same reasons. The number of operational nuclear power plants has also decreased, which has led to a decrease in the demand for uranium. This means that there is a limited amount of uranium that can be mined and used, which in turn drives up prices. The situation is expected to worsen in the coming years.
Conclusion
Nuclear power is a cleaner energy source that could help power the world in the future. Nuclear power plants produce electricity without releasing greenhouse gasses into the atmosphere. This makes nuclear power a very attractive option for countries looking to reduce their carbon footprints.
Nuclear power is a safe and reliable energy source that does not produce carbon emissions. Countries like Japan are realizing the benefits of nuclear power and are bringing their nuclear reactors back online.
As the demand for uranium grows, it is important to find new ways to access existing supplies of the element. Discoveries of uranium deposits will be increasingly valuable to maintain a balance in the market.
enCore Energy Corp, the most diversified U.S. domestic uranium developer is focused on becoming a leading ISR uranium producer. The enCore team is led by industry experts with extensive knowledge and experience in all aspects of ISR uranium operations and the nuclear fuel cycle. If you’re looking for U.S. uranium mining in Texas, look no further than enCore Energy! Visit our website to see our uranium projects!