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The price of nuclear fuel has soared to record highs as demand from intelligence data centers has squeezed the market following Russia's invasion of Ukraine.
The prices of enriched uranium hit $190 per unit of separate work – a standard measure of the effort required to separate uranium isotopes – compared to $56 three years ago, according to UxC data.
The resurgence of interest in nuclear power has come as governments and companies look for carbon-free energy sources large enough to serve large industrial and public facilities.
Big Tech companies like Microsoft and Amazon have become interested in using fossil fuels to drive Large data centers are powerful they race to build themselves as they compete for market share in AI products.
The growing competition for energy has added to the following industry concerns Russia's invasion of Ukraine almost three years ago. Russia is a key player in the process of turning mined uranium into the enriched fuel needed for nuclear power, but US sanctions and a ban on Russian exports have helped push prices to record highs.
“We don't have enough change and enrichment in the west and that's why the price has gone this way, and that price will only go up,” said Nick Lawson, chief executive of the investment group Ocean Wall.
Executives and analysts say the issue could be exacerbated by the expiration of the US exemption for exporters in 2027. That pressure has put pressure on businesses to find new facilities that can convert uranium into pellets for nuclear reactors. . Besides Russia, the main western countries with uranium processing facilities are France, the US and Canada.
“There are a lot of very important political decisions to be made” about nuclear and uranium investments, Lawson said, adding that building new facilities would take “years” and cost a lot of money.
About 27 percent of US enriched uranium imports by 2023 will come from Russia, according to Berenberg analysts. While U.S. utilities are likely to have enough fuel this year, their insurance will fall sharply over the next four years, analysts added.
“US arms will have to start contract negotiations this year to protect (uranium), especially with the ban on Russian uranium imports to the US that will start at the end of 2027,” they said.
Most uranium is sold under long-term contracts rather than on the open, or spot, market. But immediate delivery prices could rise due to possible pressures on the supply of uranium itself, industry analysts said. Kazatomprom, Kazakhstan's largest miner and the world's largest uranium producer, has warned in recent months of lower-than-expected production.
“We see more and more that the Kazakh material will go to China and Russia and less of it will go to the west,” which posed “the issue of western material”, said Andre Liebenberg, chief executive of the London-listed uranium investment vehicle Yellow Cake. “We could easily see a slowdown in supply in the medium term due to a lack of new projects that could come up quickly.”