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In 11 months of 2023, Russia increased exports of natural uranium (uranium oxide, U3O8) to the United States in monetary terms to a maximum since 2020, earning more than $1 billion. This follows from the data of the US Statistics Service. 

The volume of supplies in monetary terms in January – November turned out to be 33% more than in the whole of 2022, when the United States bought $766 million worth of uranium from Russia. At the same time, in November 2023, Russia, according to RIA Novosti estimates, regained its status as the largest exporter of uranium to the United States for the first time since May last year (then imports from Russia amounted to $177 million).

In November, according to statistics, the United States imported uranium worth about $191 million. Russia accounted for more than half of the shipments, or $96 million. The UK provided 25% of imports ($48.6 million), Japan – 22% (about $44 million), Belgium – 1% ($2.4 million). After May, Russia ranked 3-4 in terms of natural uranium supplies to the United States. The main volume was covered by the United Kingdom, Germany and France.

Current prices significantly exceed the levels that were fixed on the market before the March 2011 accident at the Japanese Fukushima-1 nuclear power plant – about $70 per pound and above. After this incident and the subsequent shutdown of all Japanese nuclear power plants, quotations for U3O8 declined for several years – up to $ 18 per pound in 2016. Then a gradual recovery began. In 2021-2022, spot prices accelerated growth, and since the beginning of 2023, this trend has become even more pronounced.

The volume of supplies in monetary terms in January – November turned out to be 33% more than in the whole of 2022, when the United States bought $766 million worth of uranium from Russia. At the same time, in November 2023, Russia, according to RIA Novosti estimates, regained its status as the largest exporter of uranium to the United States for the first time since May last year (then imports from Russia amounted to $177 million).

In November, according to statistics, the United States imported uranium worth about $191 million. Russia accounted for more than half of the shipments, or $96 million. The UK provided 25% of imports ($48.6 million), Japan – 22% (about $44 million), Belgium – 1% ($2.4 million). After May, Russia ranked 3-4 in terms of natural uranium supplies to the United States. The main volume was covered by the United Kingdom, Germany and France.

In October 2023, Russia exported $63 million worth of uranium to the United States, $32 million in September, $50.4 million in August, and about $61 million in July.

Since 2014, uranium supplies from the Russian Federation to the United States have been limited to an annual quota of 20% of the total physical volume of uranium imports into the country. Thus, despite monthly fluctuations, by the end of 2023, the total volume of exports from our country should meet this quota. The U.S. Statistics Service does not specify the physical volume of uranium imports in 2023.

The increase in exports of Russian uranium to the United States in monetary terms is observed against the background of an increase in quotations for raw materials on the world market. In 2023, the value of U3O8 on the spot market almost doubled, exceeding $91 per pound (the main volumes were traditionally purchased under long-term contracts). This year, the growth continued and the quotes broke the $100 per pound mark. On January 15, the price of uranium futures reached $104 per pound, the highest since September 2007. The absolute maximum price of uranium was recorded in May 2007 – $140 per pound.

Current prices significantly exceed the levels that were fixed on the market before the March 2011 accident at the Japanese Fukushima-1 nuclear power plant – about $70 per pound and above. After this incident and the subsequent shutdown of all Japanese nuclear power plants, quotations for U3O8 declined for several years – up to $ 18 per pound in 2016. Then a gradual recovery began. In 2021-2022, spot prices accelerated growth, and since the beginning of 2023, this trend has become even more pronounced.

S&P Global Commodity Insights called the purchase of uranium by financial funds the main driver of price growth. For example, the Canadian Sprott Physical Uranium Trust has increased stocks in warehouses by 6.6% to 63.2 million pounds since the beginning of the year.

Other factors contributing to the acceleration of price growth are limited supply (for example, Canadian Cameco lowered its uranium production forecast at two of its mines in 2023) and geopolitical risks that may affect uranium supplies from Russia and Niger (Vedomosti wrote about this on October 30). In January 2024, another driver of uranium price growth was the planned adjustment of the production plans of Kazakhstan's Kazatomprom.

Rosatom, with a production volume of about 7,100 tons of natural uranium per year (data for 2021), ranks 2nd in the world in terms of production after Kazakhstan's Kazatomprom. In 2022, Rosatom accounted for about 14% of global production, according to data from the analytical company Ux Consulting (UxC) and the annual report of the state corporation. Rosatom produces uranium in the Kurgan region, Transbaikalia and Buryatia, as well as in Kazakhstan through the Uranium One company.

According to Rosatom, in 2022, the world's uranium production increased by 6% to 50,400 tons (i.e., the state corporation's production last year was approximately 7,056 tons). At the same time, according to UxC calculations (indicated in the Rosatom report), global reactor requirements last year amounted to 63,500 tons, and taking into account the formation of commercial and strategic reserves – 74,300 tons.

About 85% of global production was provided by nine companies: Kazatomprom, Chinese CNNC and CGN, members of Rosatom Atomredmetzoloto (produces inside Russia) and Uranium One, as well as French Orano, Cameco, Uzbek Navoiuran and Australian-British BHP.

The United States is seeking to reduce dependence on Russian uranium. In December 2023, the House of Representatives of the US Congress approved a bill prohibiting the supply of uranium enriched in Russia for American nuclear power plants until 2040. But the document still has to pass through the Senate, after which it must be signed by President Joe Biden. But there are still loopholes in it that will allow the import of Russian uranium. According to Bloomberg, the bill allows its import until 2028 under special permits to give American enterprises time to find alternative suppliers.

In January, Reuters, citing the US Department of Energy, reported on the search for alternative proposals for the supply of uranium for next-generation reactors instead of fuel from the Russian Federation.

Sergey Grishunin, Managing Director of the NRA rating service, draws attention to the fact that the growth in Russian uranium supplies in 2023 is not due to volume, but due to an increase in price. He admitted that against the background of discussions about restrictions on uranium supplies from Russia, buyers in the United States can purchase it for the future. By the end of the entire 2023, the volume of supplies, according to the NRA, will exceed $ 1.1 billion. According to FG Finam, it will amount to $1.05–1.08 billion.

In 2024, in the absence of new sanctions and other prohibitions, the volume of exports to the United States may range from $900 million to $1 billion, as a correction in uranium prices is expected against the background of cheaper other energy sources, Grishunin points out. Alexey Kalachev, an analyst at Finam, notes that the current increase in uranium prices is largely speculative, it is facilitated by the revival of global interest in the development of nuclear energy against the background of decarbonization and the consequences of the energy crisis of 2022. Such a strong price increase cannot last long, since there is no real shortage of uranium on the market, the expert believes. According to the NRA forecast, uranium quotations will not reach the maximum of 2007 this year, on the contrary, a decrease to $ 50-70 per pound is possible.

According to Grishunin, there are risks of sanctions against Russian uranium in the United States, but the embargo is likely to be postponed. This will allow the States to put pressure on Russia without stopping purchases, he believes. Russia currently does not have comparable export markets in terms of volumes, but it is now impossible to find fuel that is competitive in price, so a gradual replacement of Russian supplies is more likely, the expert believes. Kalachev also considers the imposition of sanctions unlikely. He recalls that the US market is the largest in terms of the number of operating nuclear power units (more than 90) and in 2020 It accounted for 50% of Rosatom's uranium product sales.

Source: https://www.vedomosti.ru/business/articles/2024/01/16/1015197-dohodi-rossii-ot-eksporta-urana-v-ssha-podnyalis?utm_campaign=newspaper_16_1_2024&utm_medium=email&utm_source=vedomosti