Citi Forecasts Uranium Price Rebound as Supply Constraints Loom

The uranium market appears poised for a significant rebound according to recent analysis from Citi, despite experiencing a steady price decline since reaching over US$107 per pound in February. Citi maintains a tactically bullish outlook for the market's potential in 2024 and beyond, attributing recent price stagnation to low trading volume and liquidity while anticipating a shift in investor focus that could drive prices higher. The financial institution forecasts uranium prices could rise to US$98 per pound later this year with an average of US$94 per pound, and by 2025 prices could reach US$110 per pound, representing a potential 36% upside from current levels.

Increased uranium production has contributed to the recent price dip, with Kazakhstan's output expected to reach 59 million pounds this year. However, production growth is projected to slow sharply later in the decade while inventories are forecast to fall by 20 million pounds by 2030, putting uranium production back at the center of price determination. On the demand side, Citi highlights the growing need for low-carbon energy and rising global power consumption. While no new nuclear plants are currently planned, the financial institution expects utilities to focus on extending plant life and restarting shuttered facilities, potentially boosting uranium demand, particularly in the United States.

As the broader uranium market shows signs of potential recovery, companies like Generation Uranium are positioning themselves strategically through exploration initiatives. Generation Uranium is advancing its Yath Uranium Project in Nunavut, Canada, holding 100% interest in this project located in the prolific and under-explored Thelon Basin. The Yath project is strategically positioned along the trend of the Lac 50 uranium deposit, which contains 43 million pounds of uranium and is currently being developed by Latitude Uranium, a company recently acquired by ATHA Energy for $64.7 million in an all-share deal.

Historical exploration at Yath has consistently indicated uranium concentrations between 1% and 10% U3O8, underscoring its significant potential. In June, Generation Uranium acquired the Yellow Frog and Pink Toad Uranium Projects along the Angilak Trend in Nunavut, Canada. These acquisitions expand the Company's Yath Uranium Project by over 45%, bringing its total coverage to 123.45 square kilometers. Yath now extends northward, coming within 3 kilometers of Atha Energy Corp's Angilak Project, creating strategic positioning in a developing uranium district.

To advance the Yath Project, Generation Uranium has partnered with APEX Geoscience, which will provide geological consulting services and assist in preparing and submitting exploration authorization applications for a planned diamond drilling campaign. This collaboration includes coordination with key regulatory bodies to ensure compliance with all environmental and operational regulations. Furthermore, Generation Uranium has launched an advanced airborne electromagnetic survey at the Yath Project in partnership with ATHA Energy Corp. The survey is being conducted by Expert Geophysics Ltd. using cutting-edge Mobile MagnetoTellurics technology, representing a significant step forward in exploration capabilities within the region.