The positive sentiment over future uranium prices stems from the dozens of nuclear power plants under construction around the world. While we don’t go more than a week without hearing about some new nuclear power development; in the US nuclear power development has experienced continuous setbacks. This comes despite Donald Trump’s promise to boost nuclear power.
The latest blow to the US nuclear sector came this week when it was announced that in South Carolina, after $9 billion in expenditures, contractors are halting all work on the V. C. Sumner nuclear station. This comes after the Vogtle nuclear plant in Georgia was suspended after it fell behind schedule and budget.
While these plant setbacks are a negative signal for the US nuclear power sector – they are just a drop in the bucket compared to all the plants under construction overseas. China and India are moving forward with their nuclear future, and their growth will be big enough alone to increase future uranium demand and prices.
Relatively, one or two plants in the US will not make a big difference in the grand scheme of things. There are 61 commercially operating nuclear power plants in the US, and nuclear power currently provides about one-fifth of nuclear energy. Still, nuclear power is relatively challenging to get up and running in the US due to regulations, public opinion, and the availability of cheap natural gas.
While it is clear that uranium demand can improve with or without America’s involvement – it would not be wise for the country to abandon the sector altogether. While nuclear power provides only one-fifth of the country’s energy mix – it is the largest contributor of emission friendly power. If the US wants to manage its pollution over the long-run, nuclear power is crucial.