For more than ten years, the uranium market has been in decline. Uranium investments have been seemingly written off as prices plummeted from almost $140 per pound in 2007 to a staggering $20 per pound in 2016. With Japan shutting down its nuclear reactors as a result of the Fukushima disaster in 2011, the uranium market took a further hit — to invest in uranium would mean losing money.

However, recent stock and spot prices moves have caught the interest of industry watchers and investors. The reason for this was due to Kazakhstan’s uranium production company, Kazatomprom. The company had recently announced reducing production by 10% as a result of excessive global supply that made uranium prices fall further in 2016, noted an article from Bloomberg Markets. This decision has allowed uranium prices to rise — the 10% cut matching a 10% growth in the U3O8 spot price. In a comeback no one expected in uranium investing, prices reached $24.25 per pound; current prices stand at around $22.00 per pound.

The increase in price isn’t just the only positive factor for those getting into uranium investment. Many companies are using this opportunity to increase production or expand mining efforts. Following Kazatomprom’s decision, David Cates, president, and CEO of Denison Mines Corp (TSE:$DML, NYSEMKT:$DNN) notes that his company saw an increase in production as well as stock price. Cates uses the cutback made by Kazatomprom as a representation of the value of having “pounds out of the ground” rather than selling at current prices.

Along with Denison, other mining companies such as Cameco Corp (TSE:$CCO, CCJ:$NYSE) are positioned to benefit from the cutbacks. As well, explorers and developers such as NexGen Energy Ltd. (CVE:$NXE; NYSEMKT:$NXE), Fission Uranium Corp. (FCU:$TSX; TSE:$FCU) and UEX Corp. (TSE:$UEX) have also benefited from rising stock prices, which would no doubt help in their projects in Canada’s Athabasca Basin. U.S. producer Energy Fuels Inc (TSE:$EFR; NYSEMKT:$UUUU) saw an increase of 35% in its stocks since the beginning of 2017. For investors wanting to invest in uranium via company stocks, these are just some companies to keep track and take note of.

But while countries are cutting back production, China, along with other emerging countries, are building reactors. As countries such as China and India slowly move towards using nuclear energy to fuel their power needs, demand for uranium is beginning to rise. With cutback on supply and a demand that is growing, now seems like a prime time to get into uranium investment. David Talbot, a Dundee Capital Markets analyst, noted, “lower uranium prices have moved investors away from the sector, but when the price turns, it often happens quickly.”

The sudden rise in uranium prices shows just how unpredictable the market is, as Rob Chang, an analyst with Cantor Fitzgerald, comments in a Bloomberg Markets article that the news of Kazakhstan’s cutback is a definite surprise, and may be the catalyst for the high rise in uranium prices.

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