Uranium oxide prices, under pressure for years after the Fukushima nuclear accident in 2011 battered demand, picked up momentum in August 2021 when disruptions caused by Covid lockdowns hit supplies and created shortages.
They have since rocketed 250%, and are up 15% so far this month to their highest since November 2007 at $106 a lb.
“After a decade of dormancy, uranium suddenly came to life in mid-2021, rising above its long-standing cap at $30 a lb, which also happens to be the global industry’s marginal cost of mined production,” said Liberum analyst Tom Price.
Marginal costs of production are a reference to the costs incurred per lb of additional output by the highest-cost producers.
Liberum forecasts a 300,000 lb deficit this year, down from a shortfall of 1.1 million lbs in 2023, and estimates 2024 demand at 174.7 million lbs, up from 170.4 million lbs last year.
However, “while we recognize upside price risk, we…
