As concerns over energy supply rise, US and European firms are facing potential shortages in uranium. This is largely due to the increased demand for nuclear energy, which is being utilized for everything from household power to data centers, according to industry experts.
Kazakhstan, the top global producer of uranium, is shifting its sales more towards Russia and China. This trend reduces the amount available to the US and Europe. Benjamin Godwin from Prism Strategic Intelligence notes a fierce competition in Central Asia and Africa as these two countries aggressively secure resources.
Cory Kos, vice president at Cameco, one of the largest uranium suppliers in the world, warns that the industry is running low on inventory. After the 2011 Fukushima disaster created an initial surplus, that excess has now been mostly depleted. “We’re using up borrowed time,” said a former executive, highlighting worrisome inventory levels.
With the world moving towards cleaner energy, the demand for uranium is expected to soar. The World Nuclear Association projects that global uranium demand could double by 2040. Countries like the US, UK, and South Korea aim to triple their nuclear energy capacity by 2050, while tech companies increasingly rely on uranium for powering AI data centers.
China and Russia are also ramping up their domestic nuclear energy usage. Kazakhstan is a vital player, contributing about 40% of the world’s mined uranium. However, a report from the US Center for Strategic and International Studies (CSIS) points out that both nations are rapidly increasing their uranium intake.
There seems to be a gap between Western efforts to secure local uranium supplies and the planned expansion of nuclear energy usage. Gracelin Baskaran from CSIS emphasized the lack of attention on uranium production, noting it as a significant vulnerability.
Kazakhstan’s state-owned mining group, Kazatomprom, has shifted its sales, with two-thirds of its sales now heading to Russia and China, a sharp rise from one-third just two years prior. In contrast, sales to the US, Canada, France, and the UK have dropped considerably.
Niger, though responsible for a smaller portion of the global uranium market, has also pulled back on exports to Europe. A military coup there has led to a reduction in uranium exports, raising further concerns about global supply.
French state-owned mining company Orano is struggling as it faces resource depletion both in Kazakhstan and due to the recent changes in Niger’s governance. With limited options for expanding output, it may prove difficult for Western companies to secure the uranium they need.
As a result, analysts are urging US energy companies to source more uranium soon. Current market conditions may lead to a supply shock, tightening the uranium market even more in the coming months.