Goldman Sachs asserts that uranium prices are poised to surge in the coming years amid global nuclear energy developments, potentially becoming the "next gold," with widening structural supply deficits serving as the primary catalyst.
Strategist Brian Lee forecasts in the latest "Nuclear Nuggets" report that spot uranium prices could rise to approximately $91 per pound by late 2026—a 20% upside from current levels near $76. While spot and long-term contract markets operate under different mechanisms, the bank sees upward price risks for both by 2026, with term contract prices already climbing from $80 to $86 per pound since August.
The bullish outlook hinges on rapidly expanding supply-demand gaps. Goldman's models project cumulative uranium deficits of 13% between 2025-2035, ballooning to 32% by 2045. This imbalance stems from accelerated new reactor construction globally and extended operational lifespans of existing reactors.
Market dynamics already reflect these long-term shifts. November saw a notable rebound in term contract volumes—a potential indicator of renewed contracting cycles. Despite lower 2024 year-to-date contracting volumes versus prior years, persistently rising prices signal impending supply tightness.
Term contracts, typically spanning 3-10 years for utility companies, better reflect fundamental supply-demand dynamics. Current $86/lb term prices only account for fixed contract components. Producers like Cameco Corp (CCJ) suggest market-linked contracts could average $100/lb within $70-$130 ranges.
Goldman's company-specific models for CCJ and Uranium Energy Corp (UEC) also indicate spot prices reaching $91/lb by late 2026. The bank notes contracting volumes began recovering in October-November, a trend likely extending through 2026.
Updated supply-demand models show cumulative 2025-2045 deficits expanded by 211 million pounds to 1.914 billion pounds, factoring in: - Granular fuel analysis - Forward-looking reactor capacity estimates - Extended average reactor lifespan assumptions (75→80 years)
Russia's plan to double nuclear capacity adds 15 reactors (15 million lbs initial fuel demand) in Goldman's projections. The U.S. outlook incorporates: - 20 new reactors (2025-2045) - 3 reactor restarts - VC Summer project resumption Each 1GW of nuclear capacity requires 500,000 lbs annual uranium demand, implying 12.5 million lbs/year additional U.S. demand (37.5 million lbs initial loading).
With long-term demand projections shifting materially within two months against static supply forecasts, conditions favor new contracting cycles and sustained price appreciation.
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