Kazakhstan exports most uranium in eight years

Kazatomprom ups 2024 production goalsState-run Kazatomprom operates 26 deposits grouped into 14 asset clusters, all of which are located in Kazakhstan. (Image courtesy of Kazatomprom.)

Kazakhstan, the world’s leading uranium producer, has reported its highest sales of the nuclear fuel since 2015 driven mainly by China’s increase in demand as it rivals France for the second-most reactors in operation.

The total value of uranium sales abroad for the first 10 months of the year surged by a third to US$2.46 billion compared to the same period last year, according to the country’s First Credit Bureau as reported on Wednesday by The Astana Times in the nation’s capital.

China, which has 55 reactors to France’s 56 and 93 in the United States, increased its buying of Kazakh uranium by 2.2 times to US$992.7 million during the period. The former Soviet republic also hiked shipments to Russia by 72% to US$1.2 billion, the data show. The increases came at the expense of trade with Canada, which dropped 70% to US$168.5 million.

The eastward shift in Kazakh nuclear fuel comes as the U.S. and Russia square off in a new Cold War over uranium after the material’s spot price has soared by nearly 80% this year to more than US$86 a lb. on Thursday, the highest since 2007. The U.S. Senate is to consider within weeks banning imports of Russian uranium by 2028 after the House of Representatives passed the measure this month. At the same time, a leading Russian supplier has cautioned that Moscow might move first to ban exports to the U.S., according to Bloomberg.

Cameco concerns

The price increase has been driven in part by the superpower tensions over the war in Ukraine and by China’s plans to build a world-leading 22 more nuclear plants to power its economic growth while fighting smog. Since the 2011 Fukushima disaster, there’s been a nearly global re-appraisal of atomic energy — except in Germany — because it limits greenhouse gas emissions.

Despite the uranium price hike, Cameco (TSX: CCO; NYSE: CCJ), Canada’s leading producer and now a builder of nuclear plants after the acquisition of Westinghouse, said this week the price is still too low to support some mining projects to fill what the market “finally” sees as a supply gap.

“One of our concerns is that we’re not going to get out front of that and build out if we don’t have solid contracts, because if that material comes back, that’s not going to be good,” CEO Tim Gitzel said during a webcast presentation on Dec. 19.

“You see the U.S. taking steps in Congress,” he said. “So that gives us a lot more confidence and probably puts a lot more pressure on utilities to go out and secure longer term contracts with companies like ours.”

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