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Right now, when investors think about the energy sector they most often think of oil, natural gas, and coal. But there's a major player in the industry that's back on the rise after a significant fall: uranium.
Currently, uranium prices are creeping upwards after bottoming out mid-year 2014. As a clean, base load power at low cost to billions of people, uranium is a hard-asset must-have for investors' portfolios.
Take a look at why uranium prices are ready to skyrocket…
Uranium Prices on the Rise
In 2011, following the 9.0 magnitude undersea earthquake off the coast of Japan that disabled the Fukushima nuclear reactor power plant, uranium prices fell about 60%. This started a four-year bearish cycle that just recently began to slow its course.
In mid-2014, spot prices finally bottomed out near $28. They've since gained 40%, up to $38.50.
According to Money Morning Resource Specialist Peter Krauth, "Given the burgeoning demand for, and limited supply of, this crucial component of the energy mix, it's time for a closer look at uranium."
Krauth said worldwide annual uranium consumption is forecast to jump from 155 million pounds to about 230 million pounds within nine years. The United States is the largest consumer of uranium in the world, requiring more than 50 million pounds per year, yet producing only 4.7 million pounds domestically. China consumes 19 million pounds per year, but that's expected to reach 73 million by 2030.
That's why there are global uranium negotiations happening right now.
Thanks to a deal struck mid-April 2015 between Indian Prime Minister Narendra Modi and Canada, the first nuclear contract binding these two nations together in four decades came to fruition. This contract specifically outlined a five-year 3,000 tonne agreement allowing India to buy uranium in order to power its nuclear reactors.
"This may just be a foreshadowing of what's to come," said Krauth. "Despite the terrible Japanese Fukushima disaster, globally there are hundreds of new reactors either under construction or in planning stages."