[Betashares Webinar] Global Uranium Outlook
What this covers
Nuclear energy has become a popular low-carbon energy source amid global climate change concerns and a broader shift away from traditional fossil fuels. As a critical component of the nuclear fission process, uranium is playing an increasingly important role as an enabler of net zero.
In this exclusive webinar, Brandon Munro, Executive Chairman at ASX listed Bannerman Energy Ltd and adviser to the World Nuclear Association, and Mohsen Crofts, Metals and Mining Research Analyst at Bloomberg Intelligence, discussed the underlying dynamics and intricacies of the uranium market.
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The uranium market is entering a structural super-cycle driven by concurrent demand from AI data centers, government decarbonization mandates, and extended reactor lifespans, while supply response remains severely constrained by long development timelines and limited accessible projects, creating a multi-year deficit.
- AI and data center demand alone represents 500+ megawatts of new power requirements over 2-3 years, with tech companies contractually committing to nuclear power by 2030
- Supply response is structurally limited: no easy accessible deposits exist unlike lithium, Kazatomprom missing targets, Niger production shut down, and greenfield mines take 10-35 years from discovery to full production
- Utilities must restock depleted inventories while meeting new demand, creating a multi-year deficit even as existing projects ramp 20% by 2030
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Nuclear reactors can be extended beyond their original design life (e.g., 40 years) to operate for 70-80 years or longer if properly maintained, making operational extension economically attractive compared to decommissioning.
“once you have a nuclear plant built, the operational costs are actually very cheap. And so you may have a situation where you get a plant which is was either considering to be decommissioned or maybe one that's ending or getting closer to its life. And rather than have it shut down or early shut down, you you actually can spend some money to keep it operational for longer.”
To finance a new uranium mine development, long-term contracting with utilities is almost always required, both to secure an offtake buyer and to obtain pricing certainty (base price or market-related with floor/ceiling).
“to finance a new development in almost all circumstances requires long-term contracting. And that's for a couple of reasons. One is a new mine developer wants to know that it has a home for its uranium. It doesn't want to find itself producing uranium that it isn't quite sure who it's going to sell to. And in most instances and certainly the case for us, the new developer wants to obtain some level of pricing assurance.”
During COVID, a black swan event, global uranium consumption only dropped 5% because nuclear reactors cannot be turned off due to massive capital investment, demonstrating the fundamental stability and locked-in nature of nuclear fuel demand.
“The downside very well understood because you've got all of these reactors that are already had an enormous amount of capital built in and even during an incredible black swan event like COVID, global uranium consumption only went down by 5% because there's no point turning off nuclear reactors. They're the last form of power that gets turned off because of that capital investment.”
Husab uranium mine in Namibia, acquired as a vertical integration by Chinese utility CGN, achieved the most aggressive ramp-up timeline (10 years from acquisition to full production) due to political support, favorable jurisdiction, and buyer price-agnosticism.
“the most aggressive time frame that we've seen is the Husab uranium mine which goes into Namibia. So, that was enabled to be aggressive because first of all, as I've said, it was in Namibia where you can develop faster than anywhere else in the world. But more importantly, it was acquired as a vertical integration by CGN which is the second largest utility in China. So, they were to a very large and significant degree price agnostic. They just knew that they needed that uranium to go into their nuclear power plants, and they weren't the slightest bit influenced with their development process as to what the prevailing uranium price was. And that still took 10 years to ramp up fully. And it's they're still trying to achieve full ramp up some years later.”
Kazatomprom, the world's largest uranium producer, has notified investors that it cannot achieve its production targets for both 2024 and 2025, indicating that the largest single supplier cannot respond to demand growth.
“the major supplier in world uranium, Kazatomprom, notifying its investors in the world that it would not be able to achieve the production targets for 2024 and then subsequently 2025.”
At COP28 world climate conference, 23 countries including the US, UK, and France made a declaration to triple nuclear energy production by 2050 to meet their decarbonization goals.
“last year we saw at the COP28 world climate conference, we saw something quite interesting in that a group of 23 countries including the US, UK, France, got together and made a declaration that they were going to triple nuclear energy production by the year 2050. And this was for a number of reasons but chief amongst them was to meet their their decarbonization goals.”
Small modular reactors are currently very expensive, but if they achieve mainstream scale and adoption, costs will decline due to manufacturing experience and standardization, similar to how other technologies achieve cost reduction at scale.
“when you start looking at things like um small modular reactors, which are currently very expensive, but if it takes off as something that becomes very mainstream and starts to build scale, um we're very likely to see costs uh come down because of that experience and because of that scale. That's right, and that's one of the keys of big tech companies being involved in it. They want to push”
In developed markets such as the UK and Scandinavia, building new nuclear power plants is significantly more expensive than solar and wind, making nuclear uncompetitive on cost despite superior reliability characteristics.
“in the United Kingdom or in the Scandinavian countries, um building nuclear power generation on new nuclear power generation is actually much more expensive um than it is to uh build um say solar and wind.”
Lithium mining had easy ready-to-access supply from major producers (IGO, PLS, MinRes) in Western Australia (75% of global spodumene production), allowing rapid ramp-up that created supply surplus; uranium lacks equivalent easy-access supply to meet demand surge.
“One of the differences that that I would see in the the uranium market is um there isn't the same degree of easy ready to access supply that we saw with the the lithium market. So, there's no there's no IGO PLS MinRes to come to the rescue here to to supply the world's uranium. We have those uh dribs and drabs of US projects. We've obviously got Kazatomprom but they're not going to be able to lift supply significantly until 2028, 2029 when they can start procuring more assets. Um there's a couple of big projects that we're looking at for from 2030 onwards and and the big one is is NextGen with their Canadian assets but but as Brandon mentioned that's in a basically in a pristine wilderness and permitting may be a challenge.”
Emerging markets can produce nuclear power much more cheaply than developed markets, making it a cost-effective path for emission reduction targets.
“one of the key reasons is they can produce nuclear power really quite cheaply. Um And it's a it's a really good way for them to meet their um emission reductions targets as you mentioned.”
Fukushima disaster in 2011 led to 10 years of underinvestment in uranium mining as approximately 10% of the world's reactors shut down, creating a decade-long bear market and causing investment in supply to fall off a cliff.
“we had the very unfortunate Fukushima disaster in 2011. Which then saw 10 years of underinvestment in in uranium mining.”
Uranium is the only fuel source used in nuclear power plants and is unsubstitutable for that use, making uranium a single-use commodity for a power source that represents approximately 10% of global electricity generation.
“Uranium is only used in nuclear power plants around the world. And as a fuel source for that form of power, it's unsubstitutable as we stand today. So you've got a single use unsubstitutable fuel source for what is still around 10% of the world's electricity.”
Nuclear power generation is a heavily regulated industry with technological complexity and sophistication that requires significant government intervention and control, unlike simpler energy sources like solar that can be deployed unilaterally by private actors.
“there's some very good points there, and but the thing you probably need to add is it's not the type of energy generation that can be done unilaterally. So, you know, if you if you talk about things like solar power, where it's a very simple application, you can just get a buy a solar panel, stick it on your roof, right? The nuclear power generation is a heavily regulated industry. It is technologically quite sophisticated and complicated. So, there will, of course, be and continue to be a large degree of government intervention and government control of the sector.”
Mining operations of any scale take on average 15 years from discovery to production, and uranium mining has additional elongating factors including environmental regulatory requirements, political-social dynamics around uranium, and the effects of the post-Fukushima bear market on investment.
“I think the first principle is these days any mining operation of any scale takes a long time to develop. And I saw stats recently saying that the global average of larger mines is 15 years. Now, you can layer on to that the special circumstances associated with uranium mining that elongate that process. And those circumstances are the appropriate additional environmental regulatory requirements and steps that need to be taken. The political social dynamics around uranium which either slow projects down or in some cases bring projects to an abrupt halt such as where I'm dialing in from here which is Western Australia.”
Most of the initial costs of nuclear power are upfront capital expenditure for plant construction, not fuel costs, which means fuel price increases have minimal impact on the decision to run a nuclear plant at full capacity, unlike fossil fuels where fuel costs drive marginal operating decisions.
“Most of the the initial costs are in the initial construction, the capital expenditure of to build the the project. So, um it's you wouldn't typically see a decision like you would make in something like uh oil and gas where um because the oil price goes up, we're now going to switch from using oil to more coal or to more the that substitution effect is is less relevant in in nuclear power.”
Earlier in the 2010s, developed countries pursued policies to reduce or exit nuclear capacity due to political pressure around safety concerns, but over the last couple of years this trend has reversed as decarbonization and power generation requirements make nuclear reduction targets unlikely to materialize.
“Earlier in the decade we had a lot of countries looking to um get out of nuclear. There's a lot of political pressure in in Europe and the United States. So nuclear maybe it's unsafe or nuclear maybe it's not very popular. Let's try to reduce our capacity. But really the last couple of years, I think there's been a recognition that it's just not going to be possible to meet any of these targets not only for a reduction of emissions but even for just power generation with some of the additional requirements from things like AI. So those targets, those soft targets that we had previously of reducing nuclear exposure are just unlikely to eventuate I think at this point. So they're at least going to keep their existing capacity open.”
Nuclear fuel load in a reactor is replaced approximately one-third every year, and new plants require 3 years of fuel stockpile at commissioning, creating significant initial demand front-loading when new plants come online.
“you know, when you look at a nuclear power plant, it basically goes through its fuel load of enriched uranium rods about a third every year. Mhm. And when you get a new power plant come online, it essentially needs 3 years' worth of fuel.”
Utilities still have shareholder obligations to minimize fuel costs and will enter into the best commercially favorable contracts available, but they are not in a bidding war and are taking time to contract because they do not want to overpay.
“the utilities still have a responsibility to to their their shareholders and and from an operating perspective to minimize the cost that they're paying for fuel. It's still a cost, uh and so they will look to enter into the best, most commercially favorable contracts that they they can. Um So, this I guess this is probably one of the things that we're seeing as a dot market dynamic now, where um the the utilities are uh looking to well, yes, they're going to have to secure contract to supply over the next five or six years because these are these are contracts that are that are longer-term contracts, but at the same time they don't want to overpay. They don't want to be entering into a bidding war.”
China's nuclear power production is expected to grow from 16% of the world's total to over 20% by 2030, with India almost doubling their nuclear capacity over the same period, driven largely by emerging market demand rather than developed markets.
“most of the new demand for uranium and and for nuclear power capacity is really coming out of the emerging market. So China for example, we're expecting them to to grow in their nuclear production from about 16% of the world's total nuclear energy production to over 20 by 2030. That's that's a big lift over 10% lift. India is almost doubling their capacity over the same period.”
AI and data center demand is putting significant pressure on existing Western nuclear power fleets to increase their capacity through uprating (squeezing an additional 10-15% productive electricity from existing capacity).
“because of the urgency with which AI and data center implementation is requiring clean energy, that's putting a lot of pressure on existing nuclear power fleets. And we're experiencing as we talk now, the reactor fleets in the western world are doing whatever they can to try and increase their capacity or uprating as it's known in the sector.”
XAI's Grok AI platform completed the first phase of its Colossus data center (100 GPUs) in 122 days and is already doubling it with completion expected in a few months, representing approximately 500 megawatts of power consumption that will require nuclear power by 2030.
“I'll give you an example of we've seen Grok, which is the XAI platform. So, XAI have just commissioned the first phase of their Colossus data center. So, that's 100 GPUS. And they built that in 122 days. Astonishing. They're already doubling that, and we'll expect to have that completed in just a few months. When we look at that and we look at how much power that's likely to consume, together with an assumption around surrounding applications, because these data centers don't exist as islands, they then create other opportunities and commercial outcomes around them. It's reasonable to put a stab in the dark and say that's about 500 megawatts of power. That's 500 megawatts of power that's being created in a bit over 122 days.”
Only a handful of fully permitted greenfield uranium mines exist globally that are capable of coming online to meet supply response demand, including Bannerman's Etango project.
“there's no new surprises or new developments in terms of greenfield supply coming on. It's literally a handful of fully permitted greenfields mines around the world including Bannerman's Etango project that are even capable of coming on to meet this supply response right now.”
Microsoft signed a large power contract for AI data center operations with Three Mile Island, requiring restart of that reactor; Amazon signed contracts for small modular reactors; and Google/Amazon purchased a data center powered by nuclear power, demonstrating tech companies' commitment to nuclear for baseload AI power.
“you know, that demand pull effect. Um you know, you mentioned the the restart of Three Mile Island. That's off the back of a a large contract between Microsoft. They need to provide power for their AI data centers. We've seen also Amazon sign contract with another company to get small modular reactors up and running. And and likewise, we've also seen that Talon data center that that the Google sorry, it was a Google Amazon owns that bought basically a data center powered by nuclear power.”
Over the next 5 years, new uranium supply will come from project restarts from care and maintenance (e.g., Paladin's Langer Heinrich in Namibia) and capacity ramps of existing projects (e.g., Cameco and Kazatomprom projects), with approximately 20% supply growth expected.
“there is new supply coming online, but that it is correct to say that this is supply that were projects that have either been returned from care and maintenance, something like Paladin's Langer Heinrich project in Namibia, or alternatively existing projects that are now being ramped up to a a greater capacity, and that were previously running at low capacity like some Cameco's a couple of Cameco's projects, or Kazatomprom's projects in Kazakhstan which are not able to run at capacity because of lack of access to sulfuric acid which is the key reagent that they use in production. So, we do see the ability for as these projects ramp up, and there's also some projects in the United States that have that are permitted and trying to ramp up, that there is a supply response. So, we're looking at about 20% growth in supply from from where we are now”
The Bannerman Etango project is a simple mine (conventional open pit, heap leaching) that spent several years building and operating a pilot plant to validate the heap leaching process, illustrating the importance of technical risk reduction even for straightforward projects.
“The resource drilling and the metallurgy and those aspects of the project, the technical aspects of the project, well, they vary a lot depending on the nature of the project. So, in our case, it's a very simple project. It's conventional open pit moving to heap leaching. We spent several years building and operating a pilot plant just to make sure that the heap leaching was absolutely beyond doubt.”
Germany's political opposition party is considering entering the next election with a platform of restarting five of Germany's dormant nuclear reactors, indicating institutional-level reconsideration of the anti-nuclear stance.
“There's even talk of the opposition in Germany going to the next election with a platform of restarting five of their dormant reactors.”
Corporate-driven nuclear expansion differs fundamentally from 1970s government-driven expansion in that it is urgent, driven by immediate commercial need rather than central planning, and will be followed by announcements from chemicals, oil and gas refining, and other industrial processes seeking small modular reactors for net-zero decarbonization.
“it's an urgent demand driven by big corporates... And central planning done at a government policy level... takes time, which is adaptable. This is just so different because it's an urgent demand driven by big corporates... you'll see the corporate sector in other areas of urgent decarbonization start to kick in as well. You'll see it in chemicals, you'll see it in oil and gas refining. You'll see it in other industrial processes”
An incentive price level that smooths supply over an entire cycle or decade makes economic sense for stimulating exploration and development, but in the short term, prices are decoupled from immediate supply response because insufficient supply can be produced at any price due to long development timelines.
“it makes a lot of sense in a longer-term viewpoint... it makes a lot of sense to lock on to at this price we think that will over time incentivize new exploration, it will incentivize new development. In the short term, it's been decoupled from uh immediate supply simply because on our analysis, there isn't enough supply that can be responsive to a price signal right now.”
Orano announced the forced shutdown of its Niger uranium mine due to military coup complications; Niger accounts for approximately 5% of global uranium production, making this a significant supply disruption.
“Orano has announced that it's been forced now to shutter its mine in Niger. That's been an ongoing headache for Orano and other operators in Niger as a result of the military coup. That's um the way it works, you know, a situation like that particularly with a mine that's been running for quite some time is once a mine does go into care and maintenance, it takes a lot of effort and a lot of energy and time to bring that mine back into production... Niger still accounts for or was accounting for about 5% of the world's uranium.”
A super-cycle in uranium is likely to be driven by demand from AI data centers and decarbonization requirements, with no commensurate supply response currently emerging due to lack of investment over the past 15+ years.
“So, I think you can quite reasonably deduce from that that we're at the front end of what's likely to be a super cycle in uranium, driven by demand. And no doubt we'll come on to supply response, which has quite frankly been MIA owing to all of the lack of investment over the last 15 years and beyond.”
Unlike copper and other commodities with flexible supply (scrap, tailings, stockpiles, restarted idle mines), uranium has limited flexible supply response, meaning that price signals cannot elicit rapid production increases even from existing producers.
“If you were to look at copper, for example, there's a lot of production that just can come into the market, whether it's scrap or tailings or old mines uh that can be turned back on. There's a lot of sort of flexible production that can respond to prices in copper and many other commodities. There's only a limited extent to which that's relevant in this sector.”
Bannerman expects to have 10-12 different long-term contracts with utilities to supply its 3.5 million pounds of annualized production, with staggered contract initiation over 6-18 months to gradually increase average contract prices as market conditions improve.
“In our case with 3 and 1/2 million pounds of annualized production on average, we'd expect to have 10 to 12 different contracts with utilities... we're looking at those prices and as an absolute. We're looking at those prices compared to where we think this market is going to have to get to, and the market signals that they're going to see on it over the next 6 to 12 months.”
Despite lithium's environmental permitting receiving a 'helping hand' during the EV boom due to climate optimism, uranium faces persistent environmental and political permitting challenges in many jurisdictions despite its low-carbon attributes.
“The in lithium particularly during that phase there was almost a a helping hand on environmental permitting because it was going through a phase where there was a lot of optimism with electric vehicles with the clean metal. It was lithium was seen as really the the mining metal that got the free kick and the free pass. That's quite different still in uranium. Now, I have trouble understanding it and most of our shareholders do but it's still a reality in many jurisdictions.”
NextGen Resources' Canadian uranium assets (pristine wilderness location) represent the major new greenfield uranium supply expected from 2030 onward, but permitting in pristine Canadian wilderness may face significant challenges and delays.
“the big one is is NextGen with their Canadian assets but but as Brandon mentioned that's in a basically in a pristine wilderness and permitting may be a challenge.”
The US nuclear fleet has lost approximately 10 gigawatts of capacity through reactor retirements since Fukushima, and is now looking at 3 gigawatts of restarts (Palisades, Duane Arnold, Three Mile Island 3) plus an estimated 6 gigawatts of uprating, totaling approximately 9 gigawatts of new capacity or capacity recovery in the near term.
“Now to put that in perspective, the US fleet has lost about let's call it 10 gigawatts through retirements since Fukushima. We're now looking at three gigawatts of restarts. That's at Palisades, Duane Arnold and of course Three Mile Island 3 which was the big announcement a couple of weeks ago with Constellation. Now on top of that, I estimate that we will see about six gigawatts of uprating.”
BetaShares Global Uranium ETF provides diversified exposure across uranium miners, direct uranium ore holders, and uranium royalty companies, excluding nuclear power utilities, focused on the commodity source.
“BetaShares Global Uranium ETF. This is diversified exposure across uranium miners and also uranium companies that hold direct uh uranium ore and also uh uranium royalties company. So, it's it's what I would describe as a diversified exposure to to uranium and and uranium mining. It specifically excludes uh utilities that generate nuclear power. It's really focused on on the source of that commodity”