- Uranium stocks surged after President Biden signed the Prohibiting Uranium Imports Act, banning Russian uranium imports to enhance U.S. energy security and boost domestic uranium production, creating thousands of jobs.
- The U.S. government announced a $3.4 billion funding plan to support domestic uranium production, leading to significant increases in the stock prices of major uranium companies like Cameco and Denison Mines.
- Uranium Royalty Corp (UROY), which invests in uranium interests and provides funding to mining companies, is positioned to benefit from the uranium market expansion, having raised $22 million earlier this year for future uranium purchases and acquisition.
Uranium stocks are surging as Washington puts an emphasis on the production of nuclear energy in the United States. President Joe Biden signed the Prohibiting Uranium Imports Act into law in early May which effectively banned the import of low-enriched Uranium produced in the Russian Federation or by a Russian Entity. The United States currently relies on Russia for around 35% of our nuclear fuel imports. The ban will help strengthen our nation’s energy security, support the development of uranium conversion and enrichment services within our borders, and will create thousands of new jobs for Americans across the country. The ban goes into effect on August 11, 2024 and will remain in effect until 2040. This new policy is an integral decision that will help the United States build and strengthen a nuclear fuel supply chain in our borders.
In addition to the ban on Russian imported LEU, Uranium stocks rallied sharply when the U.S. government announced a plan to offer up $3.4 billion in funding to support domestic uranium production. The U.S. government will ask companies to bid next month on contracts for as much as $3.4 billion of domestically produced nuclear reactor fuel.
One of the biggest outcomes of this new policy is the increase in stock value for uranium companies. Cameco (NYSE: CCJ), which is one of the world’s largest global providers of Uranium fuel, is up 17.99% over the last month. Denison Mines (DDN), a Canadian uranium exploration, development and production company, is up 18.03% in just this month. While market leading uranium companies have already seen a significant bump in their prices,we may soon see smaller companies begin to reap the benefits as well.
A stock to watch going forward is Uranium Royalty Corp (UROY). Uranium Royalty Corp is a company that focuses on strategic investments in uranium interests, which includes royalties, streams, debt, equity investments in uranium companies, and holding physical uranium. Uranium Royalty Corp is a specialized financier that provides funding to mining companies in exchange for a percentage of their revenue. The company is a relatively safe investment within the field of energy, as it is expected to increase alongside the value of uranium, and is diversified among many different mining operations spanning around the world. Earlier this year, Uranium Royalty raised around $22 million in capital by issuing 6.7 million shares of common stock at $3.40 each. The proceeds from the stock sale are expected to be used for future uranium purchases and acquisitions, positioning the company to capitalize on potential opportunities from an expansion of the uranium market. Uranium Royalty Corp. is the world’s only uranium-focused royalty and streaming company.