Uranium Week: Trump Tariff Concerns

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Traders stepped back from the U308 spot market awaiting President Trump’s inauguration, while the IEA details a bullish outlook for nuclear energy.

-U308 spot market hits a lull 
-Nuclear energy entering a new growth phase
-Analysts sharpen uranium stocks’ earnings outlook

By Danielle Ecuyer

Politics loom large over uranium 

The spectre of incoming President Trump’s import tariffs weighed on the U308 spot market last week, according to industry consultants TradeTech.

Zero transactions were recorded between Monday and Thursday, with six transactions occurring on Friday.

One spot transaction took place in the morning session, TradeTech notes, with the consultant’s spot price indicator declining by -US$0.25/lb to US$73.75/lb. Five trades were conducted in the afternoon at prices between US$79.25/lb and US$81/lb for the 2026 delivery window.

Over the previous two months, TradeTech’s weekly spot price indicator has fallen by -11.1% and by -30.4% over the last year. At current levels, the U308 spot price of US$86.29 is still -14.5% below the 2024 average. TradeTech’s mid-term price indicator sits at US$78/lb, and the long-term price indicator at US$82/lb.

The outgoing US administration imposed additional sanctions on more than 200 entities and individuals associated with Russia’s energy sector to increase funding pressures for that country in the Ukraine war.

The consultants note sanctions against officials at the State Atomic Energy Corporation, Rosatom, were included. In response, the Russian government announced they are considering plans to offset the impacts of US sanctions.

TradeTech points to a positive tone among buyers in the term uranium market, who believe the suspension of Kazatomprom’s joint venture with Cameco, the Inkai project, will be resolved in the coming weeks.

Nuclear energy outlook 

The International Energy Agency’s (IEA) latest report, The Path to a New Era for Nuclear Energy, struck an upbeat tone for uranium and nuclear energy enthusiasts. The agency believes electricity demand will continue to grow. Over the past decade, electricity use has increased more than twice as fast as overall energy use, with electric vehicles, data centres, and AI-related applications driving demand for a “new era of growth in nuclear energy.“

Interest in nuclear energy is at its highest level since the oil crisis of the 1970s, with more than 40 countries supporting nuclear energy expansion. The IEA estimates the global fleet of 420 reactors will generate record nuclear energy levels in 2025. After hydroelectric power, nuclear energy, at 10% of global generation, is the second-largest source of low-emissions electricity.

Some 70GWs of capacity from around 63 nuclear reactors are under construction, the agency notes, marking one of the highest levels since 1990. Annual investment in new plants and extending the life of existing reactors has risen over 50% in three years to over US$60bn.

From a technological standpoint, nuclear power is reliant on Chinese and Russian technologies. Of the 52 reactors under construction since 2017, 25 are Chinese-designed, and 23 are Russian-designed. The IEA stresses the high concentration of nuclear energy intellectual property, uranium production, and enrichment poses a geopolitical risk and underscores the need for increased diversity in supply chains.

Over half of the nuclear energy projects under construction are in China, which will surpass both the US and Europe for installed capacity by 2030. The IEA points to policies targeting the development of cost-competitive small modular reactors, with a goal of 40GW capacity by 2050.

What the brokers are saying

Macquarie incorporates the $132m capital raising into its modeling for Lotus Resources ((LOT)), noting the company is now fully funded for its Kayelekera project restart.

The project has approximately a 10-year mine life remaining and is due to restart around 3Q 2025. The broker highlights the capital raising was larger than expected and more dilutive, but removes significant risk from the undertaking.

The company is also preparing a scoping study for Letihakane in Botswana, expected in 1Q 2025. Management’s previous expectations were for 3mlbpa with a 15-year mine life or a total of 42mlb U308. This mine is lower grade with higher strip ratios, making it more sensitive to price, the analyst notes.

Macquarie expects management to implement some contracts in 2025, targeting 25%-30% for the first four years of Kayelekera, with more spot contracts thereafter.

Adjusting for the increased capital raising, the broker lowers EPS forecasts by -6% to -18% for FY25 to FY27. Target price drops -5% to 40c. Macquarie reinstates the stock with a Buy-equivalent rating.

Macquarie has adopted a Neutral rating on Paladin Energy ((PDN)) following a restriction period. The broker’s modeling now includes the completed Fission Uranium acquisition, which covers the Patterson Lake South project. This is considered a high-grade uranium resource in the Athabasca Basin in Canada, with an initial 10-year mine life producing approximately 9.1mlbpa of U308.

The broker believes the resource can generate around a 27% internal rate of return at US$85/lb, assuming a later start date than Fission’s current expectations and higher costs. Capex is forecast at -CA$1.8bn, with initial opex at -CA$17.8/lb First uranium production is expected in 2031.

Macquarie anticipates the market will focus on Langer Heinrich’s ongoing ramp-up and progress at Patterson Lake regarding approvals and costings.

The analyst lowers EPS estimates for higher costs on the Canadian development by -31% to -42% for FY25 to FY27. Target price drops to $9 from $15.

Morgan Stanley and UBS have previewed the upcoming 1H25 results for Paladin. Morgan Stanley expects the focus to be on the success of plant maintenance at Langer Heinrich and updates on water storage management. The shutdown period was used to build a water supply buffer, the broker explains. Target price eases to $10.25 from $10.50. Buy rating retained.

The UBS analyst also expects the market to focus on whether water issues in 1H25, which caused a two-week plant shutdown, will persist into 2H25. The shutdown is forecast to reduce 2Q25 production by -9% on the prior quarter to 580klb. Assuming the water problems are resolved, UBS forecasts FY25 production at approximately 3mlb, with the mine restart planned for July 2025.

The stock remains Buy rated, with a $9.90 target price.

UBS has also previewed the December quarter results for Boss Energy ((BOE)), seeking updates on cost and capex guidance for Honeymoon in FY25. The analyst anticipates updates on commissioning for column 3 and the remaining three columns, scheduled to come online in 2025.

UBS retains its FY25 production estimate at 0.79mlb, versus guidance of 0.85mlb. The cost assumption is revised to include an additional -$20m in cost of goods sold for fixed costs at Honeymoon.

Target price remains $3.40, with the Buy rating retained. The company holds $65m in cash and uranium inventory of approximately $145m, placing the balance sheet in a strong position, the analyst concludes.

Morgan Stanley reduces Boss Energy’s target price to $2.70 from $2.75 and retains a Hold rating.

On Tuesday morning, Macquarie released an initiation of coverage report on Deep Yellow ((DYL)), starting off with an Outperform rating and a maiden price target of $2.

Underpinning the significant potential share price upside are two long-life greenfield urfanium assets capable of delivering 7MB/year by 2023, the report states. The modeling assumes a long-term average uranium price of US$85/lb.

Uranium companies listed on the ASX:

ASX CODE	DATE	LAST PRICE	WEEKLY % MOVE	52WK HIGH	52WK LOW	P/E	CONSENSUS TARGET	UPSIDE/DOWNSIDE
1AE	17/01/2025	0.0600	-14.29%	$0.19	$0.03
AEE	17/01/2025	0.1400	3.70%	$0.31	$0.11
AGE	17/01/2025	0.0400	2.70%	$0.08	$0.03		$0.100	150.0%
AKN	17/01/2025	0.0100	0.00%	$0.04	$0.01
ASN	17/01/2025	0.0700	0.00%	$0.17	$0.05
BKY	17/01/2025	0.3300	– 1.49%	$0.45	$0.27
BMN	17/01/2025	3.1700	4.97%	$4.87	$1.90		$7.400	133.4%
BOE	17/01/2025	2.8900	9.58%	$6.12	$2.21	27.8	$3.817	32.1%
BSN	17/01/2025	0.0200	5.88%	$0.21	$0.02
C29	17/01/2025	0.0400	0.00%	$0.13	$0.03
CXO	17/01/2025	0.0900	6.90%	$0.26	$0.08		$0.090
CXU	17/01/2025	0.0100	0.00%	$0.06	$0.01
DEV	17/01/2025	0.0900	– 1.15%	$0.45	$0.08
DYL	17/01/2025	1.3300	4.44%	$1.83	$0.91
EL8	17/01/2025	0.3000	7.41%	$0.68	$0.23
ERA	17/01/2025	0.0030	0.00%	$0.07	$0.00
GLA	17/01/2025	0.0100	0.00%	$0.03	$0.01
GTR	17/01/2025	0.0030	0.00%	$0.01	$0.00
GUE	17/01/2025	0.0800	0.00%	$0.15	$0.05
HAR	17/01/2025	0.0400	0.00%	$0.26	$0.03
I88	17/01/2025	0.6200	8.77%	$1.03	$0.14
KOB	17/01/2025	0.0700	0.00%	$0.18	$0.07
LAM	17/01/2025	0.7000	– 0.71%	$1.04	$0.48
LOT	17/01/2025	0.2300	6.82%	$0.49	$0.17		$0.540	134.8%
MEU	17/01/2025	0.0600	21.28%	$0.06	$0.04
NXG	17/01/2025	11.1600	– 0.92%	$13.66	$7.89		$16.600	48.7%
OAR	17/01/2025	0.0400	0.00%	$0.04	$0.01
ORP	17/01/2025	0.0400	0.00%	$0.12	$0.03
PDN	17/01/2025	8.4900	5.50%	$17.98	$6.83	56.1	$11.508	35.6%
PEN	17/01/2025	1.4400	12.40%	$2.90	$1.02		$4.810	234.0%
SLX	17/01/2025	5.8900	4.72%	$6.74	$3.35		$7.200	22.2%
TOE	17/01/2025	0.2200	2.33%	$0.52	$0.19
WCN	17/01/2025	0.0200	11.11%	$0.03	$0.01

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