Citi Forecasts Uranium Price Rebound as Supply Constraints Loom

The uranium market appears poised for a significant rebound despite recent price declines, according to analysis from Citi. The financial institution maintains a tactically bullish outlook for uranium's potential in 2024 and beyond, forecasting prices could rise to $98 per pound later this year with an average of $94 per pound. By 2025, prices could reach $110 per pound, representing a potential 36% increase from current levels.

Citi's research attributes recent price stagnation to low trading volume and liquidity but anticipates a shift in investor focus that could drive the rebound. The analysis points to increased uranium production as a factor in the recent price dip, with Kazakhstan's output expected to reach 59 million pounds this year. However, production growth is projected to slow sharply later in the decade, creating potential supply constraints.

Simultaneously, inventories are forecast to fall by 20 million pounds by 2030, putting uranium production back at the center of price determination. On the demand side, Citi highlights the growing need for low-carbon energy and rising global power consumption. While no new nuclear plants are currently planned, the financial institution expects utilities to focus on extending plant life and restarting shuttered facilities, potentially boosting uranium demand, particularly in the United States.

As the broader uranium market shows signs of potential recovery, companies are positioning themselves to capitalize on this trend. Generation Uranium is advancing its Yath Uranium Project in Nunavut, Canada, holding 100% interest in this project located in the prolific Thelon Basin. The Yath project is strategically positioned along the trend of the Lac 50 uranium deposit, which contains 43 million pounds of uranium and is being developed by Latitude Uranium, recently acquired by ATHA Energy for $64.7 million in an all-share deal.

Historical exploration at Yath has consistently indicated uranium concentrations between 1% and 10% U3O8, underscoring its potential. In June, Generation Uranium acquired the Yellow Frog and Pink Toad Uranium Projects along the Angilak Trend in Nunavut, expanding the Company's Yath Uranium Project by over 45% to total 123.45 square kilometers. Yath now extends northward, coming within 3 kilometers of Atha Energy Corp's Angilak Project.

To advance the Yath Project, Generation Uranium has partnered with APEX Geoscience for geological consulting services and assistance in preparing exploration authorization applications for planned diamond drilling. The company has also launched an advanced airborne electromagnetic survey at the Yath Project in partnership with ATHA Energy Corp, conducted by Expert Geophysics Ltd. using cutting-edge Mobile MagnetoTellurics technology.