Uranium hits new post-Fukushima high

The spot price of uranium continues to rise, boosted by pledges to triple nuclear power by mid-century, supply hiccups from producers such as Cameco (TSX: CCO; NYSE: CCJ) and the looming threat of a ban on Russian exports to the West.

Uranium hit US$91 per lb. this week, another record since triple-digit prices in 2007 and the fallout after the 2011 Fukushima disaster in Japan that saw several countries curb nuclear energy plans. The price has increased from about US$50 per lb. at mid-year.

“Some call it a nuclear renaissance but I like to think of it as a resurgence given the growing momentum,” John Ciampaglia, CEO of Sprott Asset Management, which runs the Sprott Physical Uranium Trust (TSX: U.U for $US;  U.UN for $CAD), said in a blog post on Wednesday. “Who would have thought that in just two years, public sentiment and government support would have shifted this strongly?”

The price could now be near a level that can sustain new mining projects as the globe increasingly looks to atomic power to help combat global warming. The increase comes as 24 nations including the United States, Japan, Canada, Britain and France pledged last month in Dubai at the 28th Conference of the Parties to the United Nations Framework Convention on Climate Change, known as COP28, to triple nuclear power capacity by 2050.

China, which wasn’t part of that pledge, still leads global nuclear plant construction with plans to nearly double capacity to 100 gigawatts by the end of this decade. The Asian country has 22 of 58 plants being built worldwide.