After the Fukushima nuclear disaster rocked the world in 2011, the nuclear power industry predictably experienced a huge setback. The problem with uranium is that when something goes wrong, it goes wrong in a big way and the media jumps all over it. These occurances are extremely rare and with modern technological advancements, nuclear power is safer than ever. A series of thousands of oil spills wont register on the news, but a nuclear reactor issue most definitely will.
Fortunately, saner thought processes have prevailed in the international community, and the world is moving toward a safer nuclear energy strategy. This is much-awaited good news as nuclear power plants are an excellent source of world’s baseload power.
Clearly, this is going to have a favorable impact on the demand for uranium in 2019 and beyond.
The global electricity demand is estimated to grow about 50% over the next 20 years; the more we think about the popularity of electric vehicles, the more conservative this number looks.
The world is looking for a solution that is low cost, has a high baseload, and delivers zero emission power. Nuclear power seems to present the most logical answer.
According to the International Atomic Energy Agency, there are presently 454 active Nuclear Power Reactors supplying 31 countries across the globe, with 54 under construction, 148 planned, and another 337 proposed across China, India, USA, and Europe.
Uranium Demand Worldwide
According to the Morning Star, the global uranium demand will see a 40% growth by 2025. The same report also says that the low secondary supplies will lead to shortfalls which will affect price negotiations in 2019.
It has been estimated that the prices should increase to around $65 per pound to support the new supply. According to Marin Katusa, – one of the leading experts on energy and resource exploration sectors – the global uranium demand will grow at a steady rate thanks to the economies of India, China, and South Korea.
In the past, the oversupply of uranium has been an unavoidable problem.
In order to make sure that history doesn’t repeat itself, two of the world’s largest producers of uranium – Cameco (CCO) and KazAtom Prom(0ZQ) announced production cuts in 2017. And that reduction in uranium production is starting to impact the market now.
According to the latest uranium report by Swiss Resource Capital AG, only 90% of the global uranium demand can be met today.
These estimates are providing to be to be accurate because the uranium prices are beginning to rise. The growing demand and dwindling supply of uranium is starting to cause a considerable increase in the uranium spot prices.
Uranium Stock Forecast 2019
In the light of alarmingly increasing electricity prices, the World Nuclear Association announced that nuclear power is an attractive alternative for 30 countries.
These 30 countries are beginning to work on nuclear power programs, and 20 more countries have expressed an interest in doing the same. It must be noted that main growth of the nuclear power programs will be seen in countries that are already experiencing technological breakthroughs. The promise of lower cost and cleaner electricity production offered by nuclear power will lead to rise in demand by developing countries as well.
All we need to make sure is the catastrophic incidents like the Fukushima nuclear disaster doesn’t happen again. If the necessary precautions are taken, who knows, we might enter into a new era with lower pollution thanks to the clean uranium-based electricity.