After a period of rapid growth in early 2024, uranium prices have fallen from $107 per pound to around $63-$64 in early 2025. This correction follows heightened investor interest in nuclear energy and shifting expectations for supply and demand in the coming years. Despite short-term losses, the long-term case for uranium remains compelling. Nuclear power expansion continues globally, and demand forecasts project significant growth.
Investor sentiment has been shaken, with uranium equities seeing steep declines—many down over 50% from their recent highs. However, seasoned analysts see this as an opportunity, as fundamental supply shortages could drive a future price recovery.
Supply and Demand Mismatch Creates Uncertainty
A key issue in the uranium market is the wide variation in demand forecasts. For instance, Yellow Cake PLC estimates 2025 demand at below 165 million pounds, while Sprott Physical Uranium Trust forecasts over 200 million pounds—a nearly 20% discrepancy. This gap stems from different assumptions regarding reactor fuel needs, enrichment processes, and stockpiling behaviors.
At the same time, uranium supply remains constrained. NextGen’s Arrow project in Canada—previously expected to add 29 million pounds annually by 2028—has been delayed until at least 2030 due to regulatory hurdles. Kazatomprom (LON:KAPq), which supplies 40% of the world’s uranium, anticipates production peaking in 2027 before declining from 2031 onward. Other mines, such as Cigar Lake and McArthur River, are also nearing depletion in the 2030s, raising concerns over long-term shortages.
Macroeconomic and Geopolitical Risks Weigh on the Market
Beyond supply constraints, broader macroeconomic factors are impacting uranium prices. Algorithmic trading has linked uranium stocks to tech equities, causing price swings unrelated to fundamentals. Additionally, political uncertainty—such as potential U.S. tariffs on nuclear fuel imports—adds further complexity to the market.
Despite these challenges, the global push for clean energy supports nuclear power as a carbon-free electricity source. Countries including China, India, and South Korea continue to expand their nuclear programs, which should sustain demand growth over the next two decades.
ETF Performance: NUKL and URNG Attract Investors
Both VanEck Uranium and Nuclear Technologies UCITS ETF (ETR:NUKL) and Global X Uranium UCITS ETF (LON:URNG) have bounced back in the past week, reflecting renewed investor confidence in the uranium market despite year-to-date declines. NUKL gained 4.54%, benefiting from strong fund inflows that pushed its assets under management to $402 million. Meanwhile, URNG rose 5.14%, attracting $43.8 million in fresh capital as investors positioned themselves for a potential supply squeeze.
The Nuclear Energy theme has seen a weekly 5.48% weekly gain, and $13.7 million in flows last week.
These gains suggest that while uranium prices have corrected, market participants still view nuclear energy as a long-term growth sector. If supply constraints tighten further and demand projections remain strong, ETFs like NUKL and URNG could see continued upside in 2025.