Uranium Week: Russia Come-Back Uncertainty

This story features BOSS ENERGY LIMITED, and other companies. For more info SHARE ANALYSIS: BOE

While the shorters follow the spot price, the experts are tuned into the uplift in contracting volumes to start 2025

-When the re-rating for Australian uranium stocks?
-Trump-Putin negotiations create uncertainty
-Spot U308 price swings remain volatile
-Macro nuclear energy trends remain upbeat

By Danielle Ecuyer

Russia Dominates Short Term

In its latest update on the uranium sector, broker Bell Potter took a deep dive into the macro-outlook for the commodity and the implications for Australian U308 miners.

The analyst forecasts a supply deficit until the end of the decade when larger uranium projects are due to come on stream. Supply chains remain delicately poised due to geo-political tensions, although a casual observer might suggest the Trump administration is bringing or attempting to bring Russia in from the cold.

A resolution to the Ukraine war may result in a relaxation of US sanctions against Russia which would ease restrictions over enriched uranium imposed in 2024 by the Biden Administration.

But let’s stick with the assumptions at hand. Bell Potter is forecasting the uranium deficit to contract to -17mlbs in 2025 from -25mlbs in 2024 with the restart of mines placing an additional 8mlbs of supply into the market and Kazatomprom’s latest update pointing to increased production.

As of January, there are 65 nuclear reactors under construction, of which 29 are in China. Accounting for net connections, some 5.33GW of nuclear capacity came on stream last year, based on seven new connections and four disconnections.

Spot pricing is expected to remain volatile, and points to speculation Kazatomprom physical trust placed over 2mlbs onto the spot market towards the end of 2024 which would account for the recent weakness in the U308 spot price.

The broker believes term pricing is likely to gain more support over the current calendar year, with long term offtake contracts sitting at 17mlbs for January compared to 110mlbs over 2024.

Due to contracting below replacement rates, or annual consumption, it is anticipated future contracting might have to be more robust to compensate.

Bell Potter highlights the gap between the short term U308 spot price around US$67lb versus the term price at US$81lb.

Turning to Australian stocks, the notable under-performance in 2024 against North American peers signals a possible rotation back into the more value end of the market with Boss Energy ((BOE)) and Paladin Energy ((PDN)) the most often quoted favourites.

As more certainty evolves around the restart of Honeymoon and Langer Heinrich, respectively, Bell Potter anticipates both stocks can benefit from a re-rating.

Boss is the top pick due to robust recent results and operations trending to FY25 guidance of 850klbs alongside lower-than-expected cost guidance from management.

Investors may seek greater clarity from Paladin over the stockpile issue, as highlighted at the recently quarterly update.

Bell Potter has Buy ratings on both Boss and Paladin with $4.85 and $10.85 target prices, respectively.

Speculative Buy ratings are ascribed to NextGen Energy ((NXG)), target $16.90, Deep Yellow ((DYL)), target price $1.65, Lotus Resources ((LOT)), target price 45c and Alligator Energy ((AGE)), target price 10c.

Spot price market continues to soften

Ongoing volatility characterised the U308 spot market. The weekly price falling -US$1.10 to US$65.25lb with ten transactions over the course of the week, as observed by industry consultants at TradeTech.

Six of the ten transactions were Cameco bound and both buyers and sellers continue to focus on the shifting narratives from the Trump administration on trade policy and tariffs.

TradeTech’s Mid-Term price indicator came in at US$76lb and Long-Term price indicator at US$82lb.

Global commitments to nuclear energy continue to rise

In major updates, Japan approved its seventh Strategic Energy Plan, which targets 20% nuclear energy by 2040. The European Commission approved Belgium’s revised plans for financing an extension of the Doel Unit 4 life and Tihange Unit 3.

The South Korean government has agreed to expand nuclear power generation with the development of new large-scale reactors and a small modular reactor by 2038. The aim is for nuclear power to reach 35% of total energy supplied by 2038.

In India, Vedanta Group is garnering bids for the construction of 5GW of nuclear capacity, which is planned to be employed by the miner for its facilities.

Boss Energy and Paladin, in that order, have the highest short interests on the ASX at 20.08% and 16.94%, respectively, with the latter up 0.89% over the last week.

For more of the latest update on uranium, see the following:

https://fnarena.com/index.php/2025/02/11/uranium-week-sharpen-your-bullish-horns/

https://fnarena.com/index.php/2025/02/18/uranium-week-confusing-spot-weakness/

Uranium companies listed on the ASX:

ASX CODE	DATE	LAST PRICE	WEEKLY % MOVE	52WK HIGH	52WK LOW	P/E	CONSENSUS TARGET	UPSIDE/DOWNSIDE
1AE	21/02/2025	0.0400	-20.00%	$0.14	$0.03
AEE	21/02/2025	0.1200	0.00%	$0.26	$0.11
AGE	21/02/2025	0.0300	0.00%	$0.07	$0.03		$0.100	233.3%
AKN	21/02/2025	0.0100	0.00%	$0.04	$0.01
ASN	21/02/2025	0.0600	– 3.03%	$0.17	$0.05
BKY	21/02/2025	0.4000	0.00%	$0.45	$0.27
BMN	21/02/2025	2.6700	– 5.19%	$4.87	$1.90		$7.400	177.2%
BOE	21/02/2025	2.8700	– 7.23%	$5.99	$2.21	20.1	$4.017	40.0%
BSN	21/02/2025	0.0210	10.53%	$0.16	$0.02
C29	21/02/2025	0.0600	0.00%	$0.13	$0.03
CXO	21/02/2025	0.0900	– 1.14%	$0.26	$0.08		$0.090
CXU	21/02/2025	0.0100	0.00%	$0.05	$0.01
DEV	21/02/2025	0.0700	– 5.26%	$0.45	$0.07
DYL	21/02/2025	1.1200	– 9.64%	$1.83	$0.91	-416.3	$1.810	61.6%
EL8	21/02/2025	0.2400	– 3.85%	$0.62	$0.23
ERA	21/02/2025	0.0020	0.00%	$0.06	$0.00
GLA	21/02/2025	0.0100	0.00%	$0.03	$0.01
GTR	21/02/2025	0.0030	0.00%	$0.01	$0.00
GUE	21/02/2025	0.0800	0.00%	$0.13	$0.05
HAR	21/02/2025	0.0500	13.33%	$0.18	$0.03
I88	21/02/2025	0.4400	– 4.26%	$1.03	$0.14
KOB	21/02/2025	0.0600	-14.29%	$0.18	$0.06
LAM	21/02/2025	0.6000	-20.00%	$1.04	$0.48
LOT	21/02/2025	0.1800	– 7.50%	$0.49	$0.17		$0.533	196.3%
MEU	21/02/2025	0.0500	– 3.64%	$0.06	$0.04
NXG	21/02/2025	8.9300	– 4.23%	$13.66	$7.89		$16.600	85.9%
ORP	21/02/2025	0.0400	0.00%	$0.12	$0.03
PDN	21/02/2025	7.5900	– 4.74%	$17.98	$6.83	54.2	$11.575	52.5%
PEN	21/02/2025	0.9600	– 2.44%	$2.70	$0.98		$4.810	401.0%
SLX	21/02/2025	4.6200	– 8.46%	$6.74	$3.35		$6.900	49.4%
TOE	21/02/2025	0.2000	0.00%	$0.52	$0.19
WCN	21/02/2025	0.0200	0.00%	$0.03	$0.01

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