What is China’s role in the uranium market De Investing.com

Investing.com — China’s growing demand for uranium is shaping the global market as the country ramps up its reliance on nuclear power and potentially expands its nuclear arsenal, according to Citi analysts.

Citi reports that China’s uranium imports are set to increase significantly in the coming years, driven by both its growing energy needs and geopolitical considerations.

“Even if China’s stockpiles are rising, current and future demand for uranium will increase and as a result import levels could intensify in the coming years, supporting the bullish narrative for U3O8 under our base case,” the bank wrote.

As of 2024, Chinese utilities require 14.6 kt U (38 million lbs), or 22% of global uranium demand, a figure expected to rise to 24.6 kt U (64 million lbs), or 28% of global demand global by 2030.

“utility requirements would increase every year (in all scenarios) as the country actively builds its nuclear fleet,” Citi adds. “The base case assumes cumulative uranium demand from China of 250 kt U (650 mln lbs) between now and 2035.”

In addition to energy demands, China’s geopolitical stance, including potential plans to expand its arsenal of nuclear warheads to match those of the US and Russia, could further boost the country’s uranium needs.

Citi estimates that this expansion would require 84.6 kt U (220 million lbs) of uranium. However, China’s domestic uranium production remains modest, with production of only 1.6 kt U (4 million lbs) in 2024, making the country heavily dependent on imports.

Citi explains that China’s current uranium stockpiles stand at about 173 kt U (450 million lbs), built up largely through imports from Central Asia and Africa.

The bank’s analysts warn that China’s future import policies could be destabilizing for the global uranium market, with the country’s share of global uranium demand expected to rise to 36 percent by 2040.

As Chinese utilities increasingly turn to international markets, Citi projects that China’s dominance in uranium purchases will increase, creating potential volatility in global uranium prices.