Uranium has momentum amid policy tailwinds, strong fundamentals: Sprott

The uranium market has momentum on its side as it looks to end 2025 on a strong note, with several catalysts lined up to fuel a sector seen as critical for the future of energy, says Sprott.In a report released on Thursday, the firm listed three key developments that could lift uranium even further, namely the US government’s critical minerals policy, accelerating demand for the nuclear fuel, and concerns surrounding supply.In the first case, Sprott analysts led by Jacob White pointed to the Trump administration’s intent to stockpile more uranium to alleviate the persistent supply gap for US utilities and the country’s heavy reliance on foreign supply, in particular that of Russia. The plan, if enacted, could result billions of dollars in funding towards building a secure uranium supply and the required nuclear technologies, reinforcing a bullish outlook for the sector, Sprott said.Secondly, Sprott said it is increasingly confident in uranium’s long-term fundamentals, especially after the World Nuclear Association’s (WNA) September symposium. It pointed to a WNA report that outlined lofty demand expectations, from the current 175 million lb. of U3O8 equivalent annually to 391 million lb. by 2040, representing a 124% growth. Importantly, the WNA forecast was more than double its previous, highlighting a surge in optimism over nuclear fuel use, especially with a “new class” of demand from hyperscalers such as Microsoft.Lastly, Sprott’s bullish sentiment is reinforced by a structurally tight supply amid expectations of declining output from the world’s top producers such as Kazatomprom and Cameco, as well as execution risks across the development pipeline. Also, it stated that the WNA report had missed some of the key production cuts, meaning the uranium market could be even tighter than headline figures suggest.Bullish outlook intactSprott said the above factors will be critical in driving the momentum in uranium as the current cycle progresses. In September, market sentiment turned sharply positive as fresh capital flowed in and supply tightened, leading to an 8% rise in uranium prices during the month and a rebound to $82/lb., it wrote.The rebound followed months of dislocation, which saw uranium prices reach a maximum spread of $17/lb. This, as Sprott said, was not “sustainable” for a market that is in a structural deficit position.Doubling down on its bullish outlook, the Sprott Physical Uranium Trust (TSX: U.U for USD; U.UN for CAD) has continued to buy up uranium and now holds over 72 million lb. — maintaining its position as the world’s largest physical uranium holder. Year to date, the Trust has gained about 8.7%, with a market capitalization exceeding $6 billion.Meanwhile, uranium equities have delivered impressive performances, with the Sprott Uranium Miners ETF rising by over 50% this year. Over the past five years, uranium and related equities have significantly outperformed other asset classes, according to Sprott.Weiter zum vollständigen Artikel bei Mining.com Weiter zum vollständigen Artikel bei Mining.com