Even though Australia is one of the biggest producers of uranium in the world, the nuclear fuel had suffered from low prices for much of the 2010s.
The 2011 Fukushima disaster had much to do with that, with many countries subsequently reducing their nuclear power generation.
The lack of demand meant some uranium mines even halted production.
However, that all changed again last year.
‘The global energy mix is changing’
When the Russian military stamped into Ukraine in February 2022, the world was immediately confronted with an energy crisis.
Russia was a significant producer of both oil and gas, but much of the Western world stopped buying from it as an economic retaliation against the invasion.
Aside from this one-off shock, the rapidly expanding middle-class population in countries like India and China means the global appetite for energy is ever-growing.
All of a sudden, those old nuclear power plants look much more tempting to reactivate.
That’s why multiple experts have mentioned this year how the uranium industry is looking bullish.
“We believe nuclear energy will become a larger slice of the energy mix, and we are seeing tangible evidence of this occurring,” Shaw and Partners portfolio manager James Gerrish said in May.
“The global energy mix is changing as decarbonisation is one of, if not, the most dominant investment theme[s] for the next decade.”
Even back then, already the amount of uranium that had been contracted in 2023 was the highest annual volume in more than a decade, he added.
So which ASX shares are the best uranium investments?
Before you think it’s too late to invest in ASX uranium shares, consider that both mines and nuclear power generators are complicated operations that take months, or even years, to reactivate.
That’s why the price for uranium hasn’t actually risen that much over the past year.
Gerrish reckons the best returns are yet to come.
“The sector is about to enjoy a period of renaissance.”
So which ASX shares are involved in uranium mining?
There are 46 stocks involved in uranium production. But among those, there are some standouts.
Paladin Energy Ltd (ASX: PDN) has a mine in Namibia that’s more than halfway past restarting production, which is due to resume next year.
According to CMC Markets, all six analysts that cover the stock rate it as a strong buy.
Boss Energy Ltd (ASX: BOE) has a promising deposit in South Australia that’s scheduled to begin producing at the end of the year.
Three analysts recommend Boss Energy as a strong buy, CMC Markets shows, while three are rating it as a hold.
One uranium stock that’s a bit different is Silex Systems Ltd (ASX: SLX).
It’s not a miner itself, but is developing laser technology that assists in the processing of uranium.
That small-cap stock is rated a strong buy by both analysts currently surveyed on CMC Markets.
