The impact of the COVID-19 pandemic is becoming conspicuous on the nuclear fuel market, with the indeterminate suspension of production at various large sites like the Cigar Lake mine, McClean Lake mill, and Kazatomprom. At the beginning of 2020, two conventional uranium mills – Shootaring Canyon Uranium Mill in Utah and Sweetwater Uranium Project in Wyoming, were on standby, and the White Mesa Mill in Utah was no longer producing uranium. Regardless of the ultimate duration of these supply disruptions, the production response to the COVID-19 pandemic is a significant and unexpected supply-side dip for the nuclear fuel industry. In less than 6 weeks, beginning in mid-March, 2020, the spot price of U3O8 had risen more than 40%, to above US$34.00 per pound U3O8.
As the COVID-19 situation continues, there is the potential for other uranium mining and processing facilities to be impacted and for the duration of the Cigar Lake and Kazatomprom production disruptions to be extended. In contrast, uranium demand has remained inelastic, with nuclear power plants around the world continuing to operate during the COVID-19 pandemic, providing reliable base-load energy to critical community infrastructure.
However, the fact that the nuclear industry has dealt with the pandemic better than most sectors, both uranium supply, and nuclear power should not be much affected in the post-pandemic world.