A secure supply of energy is essential and so uranium will remain a hot topic in 2023 due to its role in the world’s power supply.
While renewable energy remains the end goal for most countries, uranium’s place in the clean energy revolution can no longer be ignored. Nuclear restarts are already in the works, meaning more uranium will be needed soon.
Right now, 437 nuclear reactors provide 10% of the world’s electrical needs. Over the next decade, this figure is projected to increase dramatically when around 60 more reactors enter service.
There are also another 104 reactors already in the planning phase, not to mention a whopping 338 more that have been proposed.
Sprott Asset Management CEO John Ciampaglia argues that obtaining a reliable supply of uranium suitable for nuclear fuel is crucial for the success of the energy transition.
In November, he stated that nearly 180 million pounds of uranium per year is required to fuel the current global fleet of reactors. The current primary output is over 130 million pounds and is expected to rise to between 140 million and 145 million pounds by next year.
According to Ciampaglia, the only way to fix the deficit is to mine more supply. However, costs have gone up significantly which is why Ciampaglia thinks that the price of uranium needed to get a new greenfield project started is between $75 and $100.
During the last uranium bull market, which happened more than ten years ago, investors saw the spot price rise by more than 1,800%, from US$7 in December 2000 to a record high of US$136 in June 2007. This time around, the market has more things going for it, making it more likely that prices will keep going up.
The Oregon Group recently released a market report about the upcoming uranium bull market.
In the world of finance, The Oregon Group is a go-to resource. Independent capital markets professionals Anthony Milewski and Justin Cochrane created this investment research group.
Throughout his career, Milewski has worked in the mining business in various capacities, including as a consultant, founder, and investor.
The Oregon Group Predicts a 10-Year Uranium Bull Market
Milewski and The Oregon Group believe that the increase in uranium-fueled nuclear reactors is helping to create, and will sustain, a long-term bull run for uranium..
The study “The Start of the Uranium Bull Market and the Coming of the Second Atomic Age” explains some of the most important variables that have led to this increase, such as decarbonization, the commercialization of compact modular reactor technology, and energy security.
There has been a significant decrease in worldwide inventories, no new production is expected anytime soon, and there is a possibility of a shortage, as shown by an analysis of the uranium market.
Important sections of the report include:
- The uranium market has recovered from a decade-long decline. When the price of uranium increases, mining operations will be restarted. Supply won’t be able to keep up with demand any time soon because reserves and grades at existing producers are falling and more advanced development projects are needed. The producers argue that fresh production has to be encouraged with higher prices.
- The European Union has approved billions in green subsidies for nuclear energy. When fueled by uranium, one of the most energy-dense fuels, nuclear reactors produce clean energy. Opinions toward uranium and nuclear power have changed over the world for the same reasons. Many Japanese people currently advocate restarting their nuclear reactors.
- Ten years of underinvestment, mergers, and warnings from industry leaders that new output demands high prices have left the supply side in a state of recovery. Stocks of uranium have risen in value over the previous couple of years.
This research provides a wealth of data about a dynamic sector, and it analyzes the major factors that are driving and will continue to drive price growth for the foreseeable future. The study provides a list of uranium stocks and ETFs to examine, along with an explanation of why you might wish to invest in each.
This market could be in the early stages of a long-term bull market for uranium, so investors may want to keep a close eye on this market.
You can read the full version of “The Start of the Uranium Bull Market and the Coming of the Second Atomic Age” by The Oregon Group by clicking here.
SOURCE The Oregon Group
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