Uranium prices to rise again: Next stage is developing nuclear industry of Kazakhstan
Despite the decline since February, Financial giant Citi maintains an optimistic outlook for the uranium market, expecting prices for the resource to rise significantly in recent years, Kazinform News Agency correspondent reports, citing Marketindex.
The company estimates that the price of uranium will reach $98/lb by the end of 2024, and could increase to $110/lb in 2025. This is forecast against the backdrop of growing demand for nuclear energy and low-carbon technologies.
Kazakhstan and Uranium Cost
Currently, in Kazakhstan the mineral extraction tax on uranium is fixed at 6%, but starting next year, the rate will be raised to 9%. From 2026, the rate will be differentiated and will vary up to 18%.
According to Aldiyar Toktarov, Chairman of the Atomic Industry Development Association, this will definitely affect the cost of uranium.
“In this aspect, it will definitely affect the cost of uranium, not the production cost but the end product's price. This tax increase is intended to align the mining industry with the practices in the oil and gas industry, where such a progressive tax has long been in place. And we had a really favorable tax regime for the mining sector and especially uranium mining sector. And here in order for the budget to receive more funds from the profitable sectors, then such tax regime will be implemented on a step-by-step basis. So, slight increase next year. This year from 2025-2026 there will be a more complex structure implemented here,” says Toktarov.
Citi forecasts Kazakhstan’s production will ‘reach 59 million lbs this year as issues with sulfuric acid are expected to be alleviated’.
National Atomic Company Kazatomprom JSC extracts uranium at 26 sites of 13 deposits in the Turkistan, Kyzylorda and North Kazakhstan regions. All of them are polygons where many wells are installed and uranium is leached from underground.
The company itself is constantly looking for new deposits to replenish the mineral resource base of the fuel. In Kazakhstan, there are many uranium deposits that can only be mined by mining, but so far their development is unprofitable.
Key supply-side factors impacting the uranium price
In the other major global producer, Canada, production at Cigar Lake and McArthur River mines is also expected to continue to improve, albeit plateauing later this year.
Citi acknowledges that uranium mine restarts and new mines coming online would play a larger role in price determination as the broker projects supply to grow by 17 million pounds this year, by 14 million pounds next year, by 12 million pounds in 2026 and smaller increases in subsequent years.
Citi believes that a potential supply squeeze later in the decade will create a shortage, which will add to price growth. The company points to a long-term decline in reserves expected by 2030 of 20 million pounds, requiring increased uranium production.
Kazakhstan, which currently supplies 40% of the world's uranium, is well-positioned to capitalize on this trend, Toktarov said. In an interview for New Time, he emphasized that Kazakhstan, with its well-established uranium mining industry, should now aim higher by expanding into the broader nuclear industry.
