Uranium price hits 17-year high

The price of uranium hit its highest level in nearly 17 years due to tight supply and growing demand amid renewed interest in nuclear power.
Benchmark uranium oxide, which after enrichment is used in nuclear fuel, rose to $85.75 a pound (about 450 grams) for the first time since January 2007.
This rise in prices is the result of a combination of factors, namely an increase in demand due to renewed interest in nuclear power, but also due to concerns about oil and gas supplies following Russia's invasion of Ukraine.
The higher prices will cause headaches for countries that rely heavily on nuclear power, such as France, which in 2021 generated almost 70% of its electricity from nuclear power, according to data from the US Energy Information Administration.
France, along with Belgium, the United Kingdom and Romania, recently authorized the extension of the operation of several existing power plants.
In the United States, the California Public Utilities Commission (CPUC) has approved five-year life extensions for two reactors near Los Angeles that were originally scheduled to shut down in 2024 and 2025.
New projects have also started, especially in China, where 25 reactors are under construction, as well as in India, Turkey and Egypt.
According to Jonathan Hinz, president of research firm UxC, demand for nuclear power is increasing but "supply is not responding."
This is particularly true for Kazakhstan, which is the world's largest producer of uranium, producing 43% of the world's production last year, according to the World Nuclear Association (WNA).
Kazakhstan is facing logistical problems, particularly a shortage of sulfuric acid used for mining, Hinze told AFP.
According to WNA data, in 2022, around 58,000 tons of uranium were mined in the world.
Financial markets are also troubled by the recent military coup in Niger, a country responsible for 4 percent of the world's uranium production last year, Hinze said.
The Republican-led US House of Representatives voted to ban imports of uranium from Russia, which accounts for 5% of global production.
The bill still needs to pass the Democratic-controlled Senate.
All of these factors are compounded by the emergence of financial players who have amassed large reserves of uranium and driven up prices.
The largest of them is the Canadian company Sprott, which at the end of June controlled almost 28,000 tons of the precious ore.
To meet the growing demand for uranium, old mines are being reopened all over the world, for example in the US state of Utah.
"Demand for uranium will remain strong and grow," says UxC's Hinze, adding that it is not possible to increase supply overnight.
As a result, "if anything, the price will go up even more, not down" in the medium term, he said. /BGNES