“Say what you will about nuclear energy, but uranium prices will come back,” we noted in January 2014. “There’s not a doubt in my mind about that. My thought is that uranium has hit a capitulation low… It’s unwise to bet against nuclear at this point.”
And Wall Street – and the world — finally agreed.
There are more nuclear reactors under construction now that there were prior to Fukushima. The number of reactors is expected to surge from 437 today to more than 820 by 2030. And there are a strong number of catalysts on the horizon.
Second, at the close of 2013, there was a drop in uranium supply. That’s because of the Russian-U.S. Highly Enriched Uranium agreement, which removed some 24 million pounds of uranium from the market.
Third, long after the Fukushima disaster, the Japanese government of Shinzo Abe is set to reignite its nuclear energy push, reversing the previous decision to shut down all of Japan’s power plants. It’s why uranium stocks like Cameco (CCJ) popped today, signaling that uranium prices are finally bottoming out.
And finally, according to Bloomberg, “Prices of the radioactive metal are forecast to climb more than 40 percent by the end of the year as Japanese power plants restart nuclear reactors that have been shut down since the March 2011 earthquake and tsunami in Fukushima. The rebound in uranium demand may fuel takeovers as buyers try to get ahead of rising prices, Bank of Nova Scotia said.”