- Uranium Spot Struggles While Miners Gain: Uranium prices were down 3.09% in January, finding support at around $70 per pound.1 Despite this, uranium miners outperformed with a modest 1.45% gain, and junior miners surged 6.00% as they played catch-up.
- Early 2025 Turbulence: The uranium sector experienced volatility through January, largely due to the emergence of the Chinese artificial intelligence (AI) model DeepSeek and the beginning of a second Trump administration.
- U.S. Shift in Politics and Energy Regime: The Trump administration’s pro-nuclear stance intends to reshape U.S. energy policy and reinforce nuclear energy’s role in the U.S. energy landscape.
- Trade Plans Cause Concern: Trump’s trade measures and tariffs heightened uncertainty and garnered considerable attention from stakeholders across the nuclear/uranium sector.
- Uranium Bull Market: Structural supply deficits, an increasing term price and record nuclear generation expectations for 2025 reinforce a bullish long-term outlook for uranium.
Performance as of January 31, 2025
| Asset | 1 MO* | 3 MO* | YTD* | 1 YR | 3 YR | 5 YR |
| U3O8 Uranium Spot Price 1 | -3.09% | -11.32% | -3.09% | -29.84% | 18.01% | 23.40% |
| Uranium Mining Equities (Northshore Global Uranium Mining Index) 2 |
1.45% | -10.92% | 1.45% | -21.89% | 11.62% | 33.36% |
| Uranium Junior Mining Equities (Nasdaq Sprott Junior Uranium Miners Index TR) 3 |
6.00% | -12.08% | 6.00% | -25.58% | 4.78% | 34.91% |
| Broad Commodities (BCOM Index) 4 | 3.58% | 4.28% | 3.58% | 3.79% | -1.75% | 6.44% |
| U.S. Equities (S&P 500 TR Index) 5 | 2.78% | 6.22% | 2.78% | 26.38% | 11.90% | 15.15% |
*Performance for periods under one year is not annualized.
Sources: Bloomberg and Sprott Asset Management LP. Data as of 1/31/2025. You cannot invest directly in an index. Included for illustrative purposes only. Past performance is no guarantee of future results.
Uranium Miners Ignore Softer Uranium Price
Uranium prices declined 3.09% in January, finding support at around $70 per pound.1 Despite this, uranium miners outperformed with a modest 1.45% gain, and junior miners surged 6.00% as they played catch-up.2,3 The sector experienced significant volatility throughout the month, driven by key developments in geopolitics, supply constraints and disruptions in the artificial intelligence (AI) sector.
Uranium miners defy price dips, rallying despite market volatility and global supply challenges.
The return of the Trump administration brought renewed support for nuclear energy, with policy announcements emphasizing energy abundance, grid reliability, and rapid nuclear expansion. The administration’s Department of Energy (DOE) outlined initiatives to strengthen nuclear power and ensure its role in meeting growing electricity demand. However, uncertainty loomed throughout the month regarding sanctions and tariffs, leaving utilities seemingly paralyzed in fuel procurement. They grappled with the possibility that Trump could negotiate a Ukraine deal with Putin and lift the U.S. ban on Russian enriched uranium imports, as well as Russia’s retaliatory export ban. U.S. utilities have faced recent challenges, having not received enriched uranium shipments since November, when Russia enacted its retaliatory ban. Further, Trump proposed 25% tariffs on imported goods (with a reduced 10% rate on energy products) from Canada and Mexico. While these tariffs were not enacted but paused for 30 days, they contributed to volatility throughout the broader markets.
During the month, the emergence of DeepSeek, a Chinese AI model with competitive capabilities of Western AI models, while stated to be at a fraction of the cost, sparked a major selloff in AI stocks and many tangentially related AI stocks. The market became initially concerned that this would reduce AI’s impact on energy demand, as DeepSeek had also improved energy consumption, leading to a temporary decline in uranium prices. However, many then suggested that greater AI efficiency may accelerate energy consumption over time, a phenomenon known as Jevons’ Paradox, and thereby increase demand. Although AI is a long-term driver for nuclear energy, the immediate market reaction was exaggerated, and uranium miners recovered.
Another key factor was Kazatomprom’s strong Q4 operational update, which reiterated production guidance and stated that its Inkai mine had resumed operations. Prices reacted negatively to their reiteration of production guidance as investors had questioned whether they would announce another downgrade. However, Kazatomprom’s ongoing sulfuric acid shortages and its value-over-volume philosophy continue to raise concerns about long-term supply constraints and whether a surprise in production guidance is still to come.
Bull Market for Uranium Supported by Fundamentals
Despite January’s challenges, we believe that structural supply deficits, an increasing term price and record nuclear generation expectations for 2025 reinforce a bullish long-term outlook for uranium. Although there has been ample short-term volatility, the uranium market remains well-supported by rising global nuclear commitments and persistent supply constraints.
Over the longer term, physical uranium and uranium miners have demonstrated significant outperformance against broad asset classes, particularly other commodities. For the five years ended January 31, 2025, the U3O8 spot price has risen a cumulative 186.14% compared to 36.69% for the broader commodities index (BCOM), as shown in Figure 1.
Figure 1. Physical Uranium and Uranium Stocks Have Outperformed Other Asset Classes Over the Past Five Years (2020-2025)
Source: Bloomberg and Sprott Asset Management. Data as of 01/31/2025. Uranium Miners are measured by the Northshore Global Uranium Mining Index (URNMX index); Junior Uranium Miners are measured by the Nasdaq Sprott Junior Uranium Miners™ Index (NSURNJT™ Index); U.S. Equities are measured by the S&P 500 TR Index; the U308 Spot Price is from TradeTech; and Commodities are measured by the Bloomberg Commodity Index (BCOM). Definitions of the indices are provided in the footnotes. You cannot invest directly in an index. Included for illustrative purposes only. Past performance is no guarantee of future results.
Trump’s Pro-Nuclear Agenda
On January 20, 2025, Donald Trump assumed the role of president of the U.S., and the Republicans gained control of both the Senate and the House of Representatives. This political shift is expected to reshape U.S. energy policy, although the outlook for nuclear remains positive.
President Trump picked Chris Wright to lead the U.S. Department of Energy. Wright, a former fracking executive, also served on the board of directors for Oklo, a developer of small modular reactors, before resigning upon assuming the role of Secretary of Energy.Wright signed his first Secretarial Order directing the Department of Energy to take immediate action on nine points; three are highlighted below.6
- Advance Energy Addition, Not Subtraction: “Going forward, the Department’s goal will be to unleash the great abundance of American energy required to power modern life and to achieve a durable state of American energy dominance.”
- Unleash Commercial Nuclear Power in the U.S.: “The Department will work diligently and creatively to enable the rapid deployment and export of next-generation nuclear technology.”
- Strengthen Grid Reliability and Security: “The Department will bring a renewed focus to growing baseload and dispatchable generation to meet growing demand reliably.”
These policy directives align closely with prior bipartisan legislation, reinforcing nuclear energy’s role in the U.S. energy landscape. The Bipartisan Infrastructure Law (BIL), Inflation Reduction Act (IRA) and Accelerating Deployment of Versatile, Advanced Nuclear for Clean Energy Act (ADVANCE Act) have already laid the foundation for nuclear expansion, and the new administration’s initiatives further support these efforts.
Trump administration prioritizes rapid nuclear expansion, energy dominance and grid reliability.
The DOE’s focus on “Advance Energy Addition, Not Subtraction” echoes the BIL’s investment in modernizing the U.S. energy grid and ensuring a diverse and resilient energy mix. Rather than prioritizing the transition to renewable energy sources, this directive shifts policy toward maximizing all available energy resources—including nuclear, oil and gas—rather than phasing out fossil fuels to pursue climate goals. This change signals continued federal support for nuclear energy as part of a broader strategy to secure energy independence. It also suggests that funding and financial support will be redirected away from renewable energy projects prioritized under the Biden administration. Parts of the IRA, particularly those related to solar, wind and electric vehicle incentives, may face reductions or revisions.
We believe, however, that the nuclear-related components of prior legislation are likely to remain intact. The directive to “Unleash Commercial Nuclear Power in the United States” builds upon the IRA’s existing framework, which includes production tax credits and funding to extend the lifespan of operating nuclear plants. The IRA helped establish financial incentives for nuclear energy, and the new administration’s emphasis on rapid deployment and export of advanced nuclear technology—particularly Small Modular Reactors (SMRs)—aligns directly with the objectives of the ADVANCE Act. The ADVANCE Act streamlines regulatory pathways and encourages the commercialization of next-generation reactors, positioning nuclear energy as a critical solution for growing domestic and global energy demand.
Furthermore, the DOE’s commitment to “Strengthen Grid Reliability and Security” underscores the essential role of nuclear as a baseload energy source. Nuclear power provides a stable, around-the-clock electricity supply, making it a key component of grid reliability. This focus complements prior legislative efforts to expand nuclear infrastructure. It aligns with growing demand from AI-driven data centers, industrial electrification and overall increases in U.S. energy consumption from reshoring. At the same time, this shift toward reinforcing baseload power—nuclear, fossil fuels, geothermal and hydroelectric—suggests that government incentives for intermittent renewable energy sources may be deprioritized, marking a policy shift from the previous administration.
The Trump administration’s early directives reinforce the administration’s broader push for energy dominance while maintaining nuclear’s bipartisan support. While renewables face policy headwinds, nuclear remains one of the few solutions with sustained backing from both parties. With a strong legislative foundation already in place, the DOE’s new policy direction accelerates nuclear energy’s role in achieving energy security, ensuring stable power generation, and positioning the U.S. as a leader in advanced reactor technology.
Trump’s Tariffs and Uranium Markets
Starting on inauguration day, Trump threatened tariffs to take effect on February 1, 2025.7 On February 1, President Trump issued executive orders imposing new tariffs on imports from Canada, Mexico and China, citing a national emergency posed by illegal aliens and drugs.8 While all imports from Canada and Mexico were initially set to face a 25% tariff, “energy or energy resources” from Canada, including uranium, were granted a lower 10% tariff. However, on February 3, just before implementation, the U.S. temporarily paused the tariffs on Canada and Mexico for 30 days to allow for negotiations, while the additional 10% tariff on all imports from China, including enriched uranium, took effect as scheduled on February 4. These trade actions increased uncertainty and drew significant attention from participants throughout the nuclear/uranium industry, particularly regarding supply chains, pricing and the competitive landscape for U.S. utilities and miners.
Tariffs on uranium imports spark market uncertainty, fueling pressure for domestic production and early utility buying.
The tariff on Canadian uranium is particularly significant. Canada is the largest foreign supplier of uranium to the U.S., accounting for 13.2 million pounds of U3O8e purchased by U.S. utilities in 2023, equivalent to 27% of total deliveries.9 Additionally, Canada plays a crucial role in uranium conversion, with one of the only three Western conversion plants owned by Canadian uranium miner Cameco Corp., on which the U.S. depends.10 A tariff on these imports raises concerns about potential cost increases for utilities and supply chain disruptions. However, the structure of uranium transactions may provide work-arounds to minimize the direct financial impact of tariffs, as transactions can occur through swaps and book transfers rather than direct physical shipments. Furthermore, after Trump placed 25% tariffs on Canada’s steel industry in 2018, Cameco’s contracts since then have stated that in the event of U.S. tariffs, the additional cost would be shifted onto the utilities, mitigating its impact on the uranium miner.11
Uranium markets were also impacted by the tariffs imposed on Chinese imports. The new 17.5% tariff on Chinese-enriched uranium (up from 7.5%) comes amid growing U.S. concerns about the potential circumvention of Russian sanctions through Chinese enrichment facilities. While the U.S. has already moved to restrict Russian uranium imports through bipartisan legislation, this tariff escalation signals further efforts to shift the U.S. supply chains away from geopolitical adversaries.
From a market perspective, the uncertainty surrounding these tariffs has led to price dislocations, with a premium emerging for uranium already held within the U.S. compared to material stored in other countries. The continuation of this premium will depend on future policy decisions, such as whether the U.S. government implements the delayed Canadian tariffs or takes further trade actions. Additionally, the 10% tariff on Canadian uranium could still be raised if negotiations fail or Canada proceeds with retaliatory measures.
Tariff Uncertainty May Lead to Early Buying
The sanctions and tariffs uncertainty seems to have paralyzed utilities, with activity in both the term and spot markets remaining subdued.
While these trade policies introduce short-term uncertainty, they also reinforce the long-term importance of U.S. uranium production and a fully Western-aligned nuclear fuel supply chain. Given the concentrated uranium mining market, additional costs on Canadian uranium are of particular concern, with Russian/Chinese uranium off the table and Kazakh material being increasingly contracted to the East over the West. Further, as U.S. reactor requirements stand at 47 million pounds of U3O8e and domestic uranium production has plummeted to near zero (Figure 2), multiple junior uranium miners that are restarting production in the U.S. may be set to benefit.
Figure 2. U.S. Domestic Uranium Mine Production (1949-2024)
Source: EIA January 2025 Monthly Energy Review, https://www.eia.gov/totalenergy/data/monthly/pdf/mer.pdf
DeepSeek Sparks AI Turbulence
The emergence of DeepSeek, a highly competitive Chinese AI model, sent shockwaves through the technology sector and broader financial markets in January. DeepSeek’s stated ability to achieve performance levels comparable to leading Western AI models at a fraction of the cost and energy led investors to reassess the trajectory of AI-driven energy demand. With expected energy demand significantly lower, market participants feared that increased AI efficiency could diminish the predicted electricity consumption boom from AI-powered data centers. This shift in sentiment triggered a broad selloff in AI-related equities, with some of the largest U.S. technology firms seeing sharp declines in valuation.
DeepSeek disrupts markets, but AI efficiency may ultimately drive higher energy demand, boosting nuclear’s long-term outlook.
AI is considered a major long-term driver of electricity demand. The ripple effects of January’s selloff extended into the uranium and nuclear sectors, and the broader nuclear fuel sector experienced sharp declines. The prevailing market narrative had positioned AI as a structural force necessitating significant power grid expansion, reinforcing the case for nuclear energy as a stable, carbon-free baseload source.
Despite DeepSeek’s short-term impact on markets, the long-term implications of AI’s growth suggest a more complex and supportive outlook for nuclear energy demand. The key point is how greater efficiency could accelerate AI adoption, leading to higher overall power consumption. This phenomenon aligns with the Jevons’ Paradox, which suggests that as technological advancements make a process more efficient and cheaper, total consumption often increases rather than decreases.
AI Data Centers Continue to Support Higher Electricity Demand
AI-driven data centers are among the fastest-growing sources of electricity demand globally, with companies such as Microsoft, Google and Amazon aggressively expanding their data infrastructure. While DeepSeek’s efficiency improvements may reduce the energy cost, greater accessibility and affordability could enable AI to be deployed at a far larger scale, significantly increasing the aggregate power required to support AI workloads. If AI becomes embedded in more applications, the energy needed by AI-related infrastructure will likely expand rather than contract.
From a policy perspective, AI’s role in energy demand aligns with the Trump administration’s push for energy dominance and grid expansion. Trump’s support for building large-scale data centers through initiatives like the Stargate Project, a $500 billion AI infrastructure plan, reinforces the need for reliable, 24/7 baseload power sources. Nuclear energy is well-positioned to meet this demand, as it offers high-capacity, emission-free electricity generation that can support energy-intensive AI applications without the intermittency challenges of renewables.
AI data centers support rising power demand, positioning nuclear energy as a key player in the future energy landscape.
At the same time, the U.S.-China AI rivalry could further accelerate investment in AI-related infrastructure, with both nations seeking to establish leadership in artificial intelligence and computational power. If the U.S. government prioritizes domestic AI infrastructure development to compete with China’s growing AI ecosystem, this could drive additional demand for nuclear power expansion to support the industry. This would reinforce long-term bullish fundamentals for uranium as utilities and governments continue to seek secure, scalable energy sources to power data centers.
Ultimately, while AI’s role in energy markets remains a developing story, it is not the primary driver of nuclear energy demand. The most significant forces behind uranium consumption remain the global nuclear fleet build-out and the push to triple nuclear capacity by 2040. However, AI remains a potential accelerant to these trends, attracting capital flows into nuclear energy and further solidifying its role in the future energy mix. If AI adoption continues to surge (Figure 3), the need for stable, large-scale power generation will only grow, making nuclear an increasingly critical component of the global energy transition.
Figure 3. U.S. Data Centers Power Use Could Nearly Triple by 2028 (2014-2028e)
Source: Department of Energy’s Lawrence Berkeley National Laboratory, 2024 United States Data Center Energy Usage Report; https://eta-publications.lbl.gov/sites/default/files/2024-12/lbnl-2024-united-states-data-center-energy-usage-report.pdf
Kazatomprom Supply Questions
In early January 2025, due to regulatory issues, Kazatomprom (KAP) suspended production at its Inkai mine, one of the world’s most significant uranium operations. Inkai, a joint venture between Kazatomprom and Cameco, historically accounted for 5-6% of global primary uranium production. The shutdown was triggered when production fell below the legally required threshold. Kazakhstan mandates that uranium mines operate within 20% of their stated volume targets. Inkai’s failure to meet this benchmark led to a temporary suspension. This disruption raised concerns about broader supply constraints in an already structurally tight uranium market.
Kazatomprom’s Inkai mine suspension underscores ongoing supply risks in a tight uranium market.
By late January, Kazatomprom released a Q4 operational update confirming that Inkai had resumed production. The company stated that it did not anticipate a significant impact on total annual production and also reiterated its 2025 production guidance, for which prices reacted negatively as investors had questioned whether they would announce another downgrade. However, skepticism remains about whether its full-year output targets will be met. Kazatomprom’s continued struggles with sulfuric acid supply and shifting trade relationships suggest that Western utilities cannot solely rely on Kazakh uranium to meet their long-term needs.
The uncertainty surrounding Kazatomprom’s production outlook has broader implications for uranium pricing and market dynamics, especially considering the concentration of uranium supply and Kazakhstan’s significant role (Figure 4). The reiteration of production guidance and the restart of production helped stabilize sentiment, but the underlying supply risks remain unresolved.
Investors and utilities will be closely watching Kazatomprom’s February announcement, which is expected to provide further details on its 2025 production outlook. If structural supply constraints persist, this could accelerate utility contracting activity.
Figure 4. Uranium Production by Country (2023)
Source: UxC LLC. Data as of 12/31/2023.
What to Make of Market Signals?
We believe 2024’s correction in the spot uranium price and the miners may represent an attractive entry point in the ongoing bull market. While the softness in the spot market over the past few months has been frustrating and confusing to watch, we believe it is sending a false signal, given the long-term fundamentals have only improved. Key producers remain steadfast in their supply discipline strategy, and there appears to be a market standoff. Utilities are balking at the significant move in uranium prices, which will impact their future operating budgets, while producers are capitalizing on their long-awaited market leverage over utilities. As Cameco often repeats, utilities can delay and defer, but they will eventually be forced to buy.
Despite recent market softness, strong fundamentals suggest uranium’s long-term bullish outlook remains intact.
A longstanding primary supply deficit and renewed interest in nuclear energy highlight the real challenges to bring the market back into balance. With no meaningful new supply on the horizon for three to five years, we believe this bull market has further room to run. Some utilities are well covered from their inventories, while others have ignored the powerful market signals and failed to adapt their procurement strategies to the new market realities.
With global uranium mine production well short of the world’s uranium reactor requirements, the supply deficit building over the next decade, and near-term supply inhibited by long lead times and capital intensity, we believe that restarts and new mines in development are critical. The uranium price target as an incentive level for further restarts and greenfield development is a moving target, and we believe that we will need higher uranium prices to incentivize enough production to meet forecasted deficits. Over the long term, increased demand in the face of an uncertain uranium supply may likely continue supporting a sustained bull market (Figure 5).
Figure 5. Uranium Bull Market Continues (1968-2025)
Click here to enlarge this chart.
Note: A “bull market” refers to a condition of financial markets in which prices are generally rising. A “bear market” refers to a condition of financial markets in which prices are generally falling.
Source: TradeTech Data as of 1/31/2025. TradeTech is the leading independent provider of uranium prices and nuclear fuel market information. The uranium prices in this chart dating back to 1968 are sourced exclusively from TradeTech; visit https://www.uranium.info/.
Footnotes
| 1 | The U3O8 uranium spot price is measured by a proprietary composite of U3O8 spot prices from UxC, S&P Platts and Numerco. |
| 2 | The North Shore Global Uranium Mining Index (URNMX) was created by North Shore Indices, Inc. (the “Index Provider”). The Index Provider developed the methodology for determining the securities to be included in the Index and is responsible for the ongoing maintenance of the Index. The Index is calculated by Indxx, LLC, which is not affiliated with the North Shore Global Uranium Miners Fund (“Existing Fund”), ALPS Advisors, Inc. (the “Sub-Adviser”) or Sprott Asset Management LP (the “Adviser”). |
| 3 | The Nasdaq Sprott Junior Uranium Miners™ Index (NSURNJ™) was co-developed by Nasdaq® (the “Index Provider”) and Sprott Asset Management LP (the “Adviser”). The Index Provider and Adviser co-developed the methodology for determining the securities to be included in the Index and the Index Provider is responsible for the ongoing maintenance of the Index. |
| 4 | The Bloomberg Commodity Index (BCOM) is a broadly diversified commodity price index that tracks prices of futures contracts on physical commodities, and is designed to minimize concentration in any one commodity or sector. It currently has 23 commodity futures in six sectors. |
| 5 | The S&P 500 or Standard & Poor’s 500 Index is a market-capitalization-weighted index of the 500 largest U.S. publicly traded companies. |
| 6 | Source: U.S. Department of Energy, Secretary Wright Acts to “Unleash Golden Era of American Energy Dominance. |
| 7 | Source: CNN Business, Trump threatens 25% tariffs on Mexico and Canada on Feb. 1, punting Day 1 pledge. |
| 8 | Source: Whitehouse.gov, Fact Sheet: President Donald J. Trump Imposes Tariffs on Imports from Canada, Mexico and China. |
| 9 | Source: Eia.gov, 2023 Uranium Marketing Annual Report. |
| 10 | Source: WNA, Nuclear Fuel Cycle Conversion and Deconversion. |
| 11 | Source: The Globe and Mail, Cameco hopes to repeat its 2018 success in fending off Trump uranium tariffs as threat looms once more. |
