Uranium — Market Research

Executive Summary

In 2026, the uranium market crosses a threshold where multiple independent sources of demand converge at the same time that uranium supply is structurally unable to respond in the required window.

The core issue is a timing mismatch:

• Uranium mines take years to develop, restart, or expand
• Utilities are forced to secure replacement fuel in the near-term, beginning in 2026

Two forces are often conflated, but they operate differently:

1. The Nuclear Renaissance (accelerates from 2026) — Structural demand growth that shapes long-run uranium direction: new reactors, SMRs, life extensions, and AI-driven power demand. Long-term demand that compounds the squeeze.
2. The Mechanical Squeeze (already unavoidable) — A procurement-driven squeeze that does not depend on optimism or future builds. Utilities must maintain minimum forward fuel coverage, and a large block of low-priced post-Fukushima contracts begin expiring from 2026.

As contracts roll off and coverage falls below levels required by regulators, boards, and insurers, procurement becomes compulsory, not discretionary—forcing utilities back into the market regardless of price.

PART I: THE CRISIS

Why the system is resetting

The nuclear renaissance (accelerates from 2026)

Snapshot — the demand problem is changing rapidly

Artificial intelligence and hyperscale data centres are changing electricity demand because they run 24/7 and cannot power down. Unlike traditional demand, this load is constant, concentrated, and requires reliable always-on electricity, not intermittent supply.

Goldman Sachs estimates data-centre electricity demand could increase by 165% by 2030, implying the need for ~85–90 GW of new baseload capacity over the coming decade—equivalent to building another entire U.S. nuclear fleet.

Hyperscalers are already acting

These companies are not speculating—they are locking in nuclear power decades ahead:

• Microsoft: 20-year offtake tied to Three Mile Island Unit 1 restart (~835 MW, 2028)
• Google: Framework agreement with Kairos Power for up to ~500 MW, first deployment ~2030
• Amazon: Backed X-energy with ~$500m, targeting ~5 GW of SMR capacity by 2039
• Meta: RFP seeking ~1.4 GW of U.S. nuclear capacity
• Oracle: Plans for ~1 GW data-centre campus powered by three SMRs

It's not just America

• China: 20+ reactors under construction; plans for dozens more by 2035
• India: targeting 13× capacity expansion by 2047
• Japan: progressive reactor restarts post-Fukushima upgrades
• South Korea: reversal of phase-out policy; expansion program underway
• Europe: France expanding fleet; Poland/UK/Czech advancing newbuilds

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If there is supply, demand is near-guaranteed.

Structural reality

Global supply deficit

After Fukushima in 2011, uranium prices stayed too low to justify new mines for more than a decade. Producers cut output, delayed spending, and put projects on hold. When demand recovered, the industry had older mines, limited restart capacity, and few new economic projects.

Key Facts:

• Global uranium demand expected to rise from ~200 Mlb/year today to ~300 Mlb (base) and 400+ Mlb (high-demand) by 2030s–2040s
• Even if every currently planned mine goes ahead, supply still falls short by ~70–150 Mlb/year (25–40% of demand)
• Higher prices are required to force new mine development

Economics of mine expansion: why supply can't respond

• Mines take 3–10 years from investment decision to production
• Producers build mines based on long-term contracts, not spot prices

Incentive thresholds:

• $60/lb: sustains existing production only
• $70–80/lb: enables some restarts of shutdown mines
• $80–100/lb: new mine development

U.S. deficit exposure across the fuel chain

• U.S. consumption: ~49.5 Mlb/year (largest national consumer)
• U.S. imports ~92% of uranium; only ~8% mined domestically
• Only one operating U.S. mill: White Mesa
• ~27% of U.S. enrichment historically sourced from Russia
• U.S. ban on Russian uranium imports scheduled for 2028

HALEU SMRs enter the fuel chain

What are SMRs, and what is HALEU?

SMRs (Small Modular Reactors) are the next phase of nuclear deployment, designed to deliver firm baseload power where large reactors are impractical. Many advanced SMRs require HALEU (High-Assay Low-Enriched Uranium), enriched to ~5–20% U-235 vs ~3–5% for conventional reactors.

HALEU fuel typically requires 30–80% more uranium per unit of usable fuel than conventional fuel.

2026 outlook: HALEU becomes binding

DOE established a HALEU Availability Program and allocated ~21 metric tonnes of HALEU through 2026 to support fuel fabrication, qualification, and initial loads.

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TL;DR: SMRs affect uranium demand before they affect electricity supply.

Uranium onshoring

On November 7, 2025, uranium was added to the nation's Critical Minerals List, formalising that fuel-chain resilience is inseparable from energy and national security.

What onshoring looks like (Executive Orders, May 2025)

U.S.-based developers benefit because domestic supply becomes strategic: preferred suppliers, easier financing, and asset optionality repriced.

3 — Organic demand squeeze (utility procurement)

By 2026, once coverage falls below acceptable thresholds, procurement becomes compulsory. Two forces converge:

Stage I: Long-term contract roll-off

Utilities procure uranium via long-term contracts (3–10 years). Many contracts expiring in 2026 were signed in 2011–2016 when uranium spot was ~$40–55/lb. Weighted-average realised contract price for U.S. utilities was ~$52.71/lb in 2024.

By late 2025, prevailing long-term prices approach $80/lb, creating a discontinuity.

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Procurement is no longer discretionary; it becomes compulsory.

Stage II: Failed buffers (inventories can't solve it)

Inventories are buffers, not supply. Each pound used now must be replaced later. At post-2026 gap scale, inventories would be depleted at rates exceeding historical norms.

Stage III: Inelastic supply

With inventories unable to absorb the gap, the burden shifts to primary supply—yet production is inelastic on a 2026–2028 timeline.

• Restart timelines 18–36 months minimum
• Permitting/financing/labour/commissioning delays
• Fuel-cycle bottlenecks: no U.S. conversion, limited Western enrichment
• Producers will not increase supply without incentive pricing

Conclusion: prices and tighter contract terms become the only clearing mechanism.

Part II: The Squeeze

What happens when procurement turns compulsory

Price path scenarios (2026)

PART III: THE WINNERS

As the squeeze unfolds, not all participants benefit equally. Winners are defined by positioning:

• Spot-exposed producers: Highest leverage to rising prices
• Low-cost restarts: Marginal production enters profitably
• U.S.-based assets: Policy tailwinds, strategic premium
• HALEU optionality: Exposure to next-gen fuel demand

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The best positioned companies are those with spot exposure, low-cost restarts, and U.S.-based assets.

Conclusion

The uranium market in 2026 is defined by a structural collision: demand that can't be deferred meeting supply that can't respond. The squeeze is not a forecast—it is already in motion.

For investors, the question is not whether prices rise, but how high and for how long. The answer depends on how quickly new supply comes online—and current lead times suggest the gap persists through 2028 at minimum.

About Us

Montgolfier Research is an independent research platform focused on asymmetric opportunities in public markets. We publish deep-dive analysis on companies and sectors where we see structural mispricings.