President Donald Trump’s tariff threats might increase the value of uranium used to gas US nuclear reactors, which might have ripple results on a tenuous nuclear renaissance spurred by the expansion of energy-hungry knowledge facilities.
The US will get more than a quarter of its uranium from Canada, greater than from some other nation. The Trump administration imposed new tariffs on uranium and different items on Canada this week, which he quickly paused after a inventory market drop and sell-off.
It might play into efforts to construct up a home uranium provide
It’s too quickly to know what the precise impression could be on the US’s nuclear vitality business if tariffs transfer ahead. It might play into efforts to construct up a home uranium provide, which has gotten bipartisan assist and curiosity from main tech firms. However within the close to time period, the US nonetheless depends on its northern neighbor to maintain reactors working.
Trump proposed a 10 percent tariff on vitality merchandise from Canada, however he introduced yesterday that it might be paused till no less than April 2nd. Canada-based Cameco, one of many world’s largest uranium producers, warned that the tariffs would inevitably result in greater costs.
“It’s sort of Econ 101 to determine what the impression of tariffs are on this state of affairs,” Cameco CFO Grant Isaac stated in a February 20th earnings call. A ten p.c tariff would result in a ten p.c rise in uranium costs, Isaac stated, whether or not that’s from Canada or elsewhere. “Historical past tells us non-tariff international locations will merely enhance their provide costs to simply underneath 10 p.c,” he stated. When reached for remark this week, a spokesperson for Cameco stated Isaac’s feedback on the decision nonetheless maintain.
The Nuclear Vitality Institute, a commerce affiliation primarily based in Washington, DC, was coy when requested about how the tariffs may have an effect on the US nuclear vitality business. “We agree in precept that actions needs to be taken to unleash America’s vitality dominance and shield our nationwide safety, whereas additionally creating a strong financial system that spurs job creation. Nonetheless, these measures might hinder progress and innovation within the vitality sector and the nations’ potential to attain vitality dominance,” Doug True, senior vp of technical and regulatory providers and chief nuclear officer, stated in an emailed assertion.
Uranium costs have risen dramatically in recent years, with rising curiosity in nuclear vitality — together with from Google, Amazon, Microsoft, and Meta looking for out nuclear vitality to energy new AI knowledge facilities. Greater uranium costs incentivized the resurgence of uranium mining within the US, with the primary mine to open in nearly a decade beginning up close to the Grand Canyon final yr. The Russia-Ukraine war is one other issue, with the Biden administration banning uranium imports from Russia, one other main provider, final yr.
“Why are we depending on overseas nations when the US has the potential, has the assets, has the know-how to really grow to be vitality impartial, particularly in nuclear?” says Jay Yu, president of LIS Applied sciences, a US-based laser uranium enrichment firm.
However even when the US builds up its home provide chain, it’s nonetheless constrained by geography. The US solely holds about 1 percent of the world’s uranium reserves, whereas Canada holds about 10 occasions as a lot. “Tariffs would threaten uranium provide at a time when america is looking for to develop its nuclear dominance,” Gracelin Baskaran, director of the Crucial Minerals Safety Program on the Heart for Strategic and Worldwide Research, wrote in a late January analysis.
The emergence of DeepSeek’s AI models in China, which may ostensibly use a lot much less vitality than US rivals, has additionally made the way forward for data center energy use and nuclear energy extra uncertain.
Nuclear vitality remains to be a sensitive topic that’s created some unusual bedfellows. Not like coal and gasoline energy vegetation, nuclear reactors don’t generate greenhouse gasoline emissions. That’s put it on the desk as a substitute for fossil fuels that some local weather hawks champion. However somebody has to mine the uranium for these nuclear reactors, which some environmental teams and Indigenous activists are fighting fervently. The US has a history of uranium mines contaminating water resources on Navajo Nation land.
Trump, a giant fan of the fossil gas business that dumped tens of millions of dollars into his marketing campaign, has primarily tried to eradicate action on the climate crisis within the US. He might carve out exceptions for nuclear vitality applied sciences which have garnered assist from extractive industries and Huge Tech. He tapped Chris Wright to steer the Vitality Division; Wright was beforehand the CEO of a serious oil and gasoline service supplier and sat on the board of directors for an organization growing superior nuclear reactors with OpenAI CEO Sam Altman.
Uranium sits on the nexus of many various energy performs within the US, and tariffs might increase the stakes for everybody with one thing to lose or achieve.