We’re reader-supported and may be paid when you visit links to partner sites. We don’t compare all products in the market, but we’re working on it!
Australia is the third biggest uranium producer and holds around one third of the world's uranium resources. There are several ASX-listed mining stocks with uranium exposure. Some have been actively mining for many years, such as Energy Resources of Australia (ASX: ERA), while others are exploring new uranium deposits alongside other resources such as gold or silver.
This commodity is best known for its use in nuclear energy production but has a destructive history. In recent years, uranium prices have fallen amid oversupply issues as Kazakstan has ramped up production and the Fukushima disaster led to plunging sentiment toward nuclear energy use.
Investors should explore how this material is mined and used before they invest.
What is uranium?
Uranium is a radioactive heavy metal used to fuel nuclear reactors and craft nuclear weapons. It’s mined in a number of countries, but a majority of the world’s uranium supply comes from Kazakhstan, Canada and Australia. Kazakhstan commands the market and was responsible for a whopping 43% of the world’s uranium supply in 2019.
Uranium stocks are stocks from companies involved in the mining, refining and distribution of global uranium.
Why invest in uranium stocks?
As oil production and consumption continue to trend downward, the world has begun to look to alternative energy sources — and nuclear energy is a big contender.
The World Nuclear Association reports that 30 countries worldwide are working to build nuclear power programs, including China, India, Israel, Norway, Saudi Arabia and Uganda, to name a few.
Uranium fuels nuclear energy. And nuclear energy presents a low-carbon alternative to fossil fuel. The International Energy Agency states that the world must double its nuclear power capacity by 2050 to meet climate change emission-cutting targets.
Uranium is poised to play a big role in the future of global energy production. Investors who buy now could have a viable buy-and-hold investment on their hands as nuclear energy ramps up around the world.
Risks of investing in uranium
Some global attitudes towards uranium have begun to pivot, but not everyone is ready to put uranium’s destructive past behind them.
The devastation of uranium-packed nuclear bombs on Hiroshima and Nagasaki coupled with the terrifying fallout of Chernobyl stand as proof of uranium’s dangers. And after the Fukushima power plant meltdown in 2011, Japan shuttered the doors on most of its nationwide nuclear plants. A country that planned to increase its nuclear power generation to 40% by 2017 now draws less than 2% of its energy from nuclear power.
And Japan isn’t alone. Germany dropped its nuclear energy consumption from 25% in 2011 to 12% in 2019. Other countries have discontinued or banned nuclear energy entirely, like Australia, Italy and Lithuania.
The future of uranium is uncertain. As demand for this type of energy increases in some countries, others are actively reducing or eliminating their consumption.
Uranium is a divisive material and investment. Investors interested in this commodity should familiarize themselves with the potential dangers before buying in.
Uranium is a global resource mined and produced by numerous international companies. For well-rounded uranium portfolio exposure, prepare to invest in both Australian and international stocks.
ASX uranium stocks
International uranium stocks
- Areva SA (ARVCY)
- Aura Energy (AUEEF)
- Berkeley Energia (BKLRF)
- Fission Uranium (FCUUF)
- Paladin Energy (PALAF)
Which ETFs track uranium?
To date there are no ASX-listed uranium ETFs and there are only a few pure play ETFs dedicated to tracking uranium on overseas exchanges. These include:
- Global X Uranium ETF (NYSE:URA)
- Horizons Global Uranium Index (TSE:HURA)
- North Shore Global Uranium Mining ETF (NYSE)
- VanEck Vectors Uranium + Nuclear Energy ETF (ARCA:NLR)
Compare trading platforms
To invest in uranium stocks, you need a brokerage account. Review your options.
Important: Share trading can be financially risky and the value of your investment can go down as well as up. “Standard brokerage” fee is the cost to trade $1,000 or less of ASX-listed shares and ETFs without any qualifications or special eligibility. If ASX shares aren’t available, the fee shown is for US shares. Where both CHESS sponsored and custodian shares are offered, we display the cheapest option.
Whether this commodity belongs in your portfolio depends on how you see the nuclear sector growing in the coming years. Review your brokerage account options across multiple platforms to find the account that best meets your needs.
Frequently asked questions
Ask an Expert