2020 was an unforgettable year in terms of global events and their consequent impact on the uranium industry. With the COVID-19 pandemic hitting the world swiftly and badly during the year, it underlined the importance of electricity reliability and resilience during times of major disruption.

Throughout 2020, nuclear power has continued to generate electricity reliably and around the clock, ensuring the continuous resilient operation of critical services indispensable to cope with the global health crisis and maintain social stability. Nuclear power plants supplied 2,600 TWh of emissions-free electricity in 2020, which accounted for approximately 10 per cent of total global electricity generation and nearly one-third of the world’s low-carbon electricity production.

Uranium has been one of the best performing commodities in 2020. Once the pandemic became global, operations at mines in Saskatchewan (i.e., Cigar Lake) and across Kazakhstan were either completely or partially suspended to deter the spread of the disease. The obvious result was the reduction of U3O8 output. According to industry consultancy UxC, the estimated total production in 2020 would be 123.6 million pounds U3O8, which is down 13 per cent from 2019. This figure has been the lowest since 2008 and would only represent roughly 68 per cent of total annual demand in 2020. The remainder of demand was covered by inventories and other secondary supplies

During the first quarter of 2020, the uranium spot price remained at approximately USD25 per pound, the same level as the second half of 2019. However, it rose sharply following the Cigar Lake suspension in late March, peaking at USD34 per pound in late May, based primarily on heavy producer purchases for delivery of spot material at Cameco. Since then, prices have retreated to end the year closer to the USD30 per pound level.

The increased producer activity in the spot market also gave rise to heightened activity from traders, financial funds, and others, ultimately pushing spot transaction volume to 92.3 million pounds U3O8 for the year, which is the highest in uranium history.


The overall long-term contracting volume fell by over 40 per cent from 2019’s 96.2 million pounds U3O8 to 2020’s 56 million, but the number of contract awards increased by about 23 per cent.

A portion of the year’s contracting activity took place during the first quarter of the year before the impacts of the COVID-19 pandemic had spread globally. Term activity then paused until about August, and thereafter picked up through to the end of the year.

After holding flat throughout 2019, the UxC long-term indicator increased USD2 to USD33.

Source: UX Consulting


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In 2020, the OECD Nuclear Energy Agency (NEA) and the International Atomic Energy Agency (IAEA) released its latest Uranium 2020: Resources, Production, and Demand, known as the ‘Red Book’. The Red Book states that uranium requirements by 2040 could range from between 147 million pounds U3O8 in the low case to 261 million pounds in the high case. This compares against world uranium requirements of 154 million pounds at the end of 2018.

Further, the Red Book notes that sufficient resources exist to support the continued use of nuclear power. Identified recoverable resources are sufficient to cover potential future demand for the next 135 years. However, the report notes that considerable exploration, innovative mining techniques, and timely investment will be required to turn these resources into refined uranium, ready for nuclear fuel production and to facilitate the deployment of promising nuclear reactor technologies.

In 2021, world production level will still be the most important factor driving the market. Though some mining companies could choose to suspend their mining activities and buy spot material to fulfil sales commitments, this may not be a long-term sustainable approach, given its implications on cash flow and capacity maintenance.

Another factor is utilities’ unfilled demand and procurement strategy. Utility procurement has been slowed down due to 2019’s various international political issues and 2020’s COVID-19 pandemic. It is widely believed in the industry that utilities will need to reconsider their mid-term and long-term procurement as they enter the new decade, and their historical contracts taper off. However, the exact timing remains debatable.


In 2020, Rössing produced 5.5 million pounds U3O8. A total of 2.0 million pounds were shipped to western converters and sold to customers in North America, Asia (excluding China) and Europe, Middle East and Africa (EMEA). A total of 4.0 million pounds, including some production from the 2019 year, were shipped to China and sold to CNNC. Rössing continued to benefit from the contractual sales prices in its historical contract portfolio, as well as the beneficial CNNC off-take agreement, with an average sales price across the entire portfolio, well above the average spot price for the year.

In 2021, in order to maintain our perfect delivery record on our historical contract portfolio, Rössing management will put extra focus on raw material supply, production and uranium product logistics to mitigate the impacts from the pandemic. The marketing team will further strengthen the communication with potential buyers of uranium and try to commit more sales during this on-going decade.