Uranium market entering a structural deficit as new demand drivers meet supply shortfall

Following the 2011 Fukushima disaster, the uranium market and price environment remained muted, as reactor shutdowns vaporised demand faster than mine supply could adjust. Now, however, the uranium market is entering a structural deficit, as assessed by Benchmark's Uranium Service. The market is already in a marginal deficit for 2026, but as nuclear power plays a growing role in the roll-out of data centres and other industries, this is forecast to grow to 18% of demand by 2027, and will continue to expand unless new supply can be bought online.

“Many players are highlighting technological advances and rapid demand growth, such as the potential contribution of microreactors and small modular reactors (SMRs) to meeting demand from AI hyperscalers,” said Tony Alderson, Benchmark’s uranium research manager. “However, it is easy to overlook the notable rise in mined uranium supply that will be required to support this growth. Significant additional investment will be needed, and soon, to ensure sufficient supply is available to meet future demand.”

The developing supply gap in mined uranium is addressed in Benchmark’s Uranium and the Nuclear Fuel Cycle Special Issue.

China expected to lead demand growth with new reactors

Significant new nuclear reactor construction is planned in Asia, with China’s current ~68 gigawatt electric (GWe) capacity expected to see particularly strong growth, with 42GWe currently under construction and a further 26GWe planned. More than 30GWe is either under construction or planned in the rest of Asia, and more than 20GWe in Europe.

This buildout is driving the increased demand for uranium expected in the coming years, and is downstream of growing global energy demand that is in part a result of increase data centre construction. It has been enabled by governments more committed to nuclear energy in recent years than in those since Fukushima.

The development of SMRs offers the possibility of more easily deployed, replicable reactor designs, and is also likely to contribute to increased demand, though the current pipeline of 73 SMRs tracked by Benchmark is likely to contribute only <2,000 tonnes of uranium per year.

Supply to remain constrained overall despite Namibia growth

Supply of mined uranium is largely centred on Kazakhstan, which produces 39% of all uranium mined globally but whose growth is expected to be constrained in the immediate term. This is largely a result of tight supply of sulphuric acid, used in its in-situ recovery (ISR) uranium projects, a shortage of the required skilled labour, and a record of downwardly-revised output guidance. Sulphuric acid-related challenges also closed one of North America’s most important operations, Cigar Lake in Canada, for a short period in July 2026.

Namibia has become the world’s third-largest producer of uranium with significant investment from Chinese companies, and its production is expected to continue to grow through 2030. However, significant dialling-back of operations elsewhere as a result of low uranium prices between 2014 and 2021 means new supply, which can take ~10 years to bring online, means demand will outstrip supply by a widening margin in the coming years.

Benchmark is hosting a webinar on the future of uranium on 29 October, providing an exclusive look at the supply-demand balance to 2030. You can register for that here.