Red Book sees modest decrease in uranium resources but expects nuclear capacity to increase7 April 2023
“Uranium 2022: Resources, Production and Demand”, widely known as the Red Book, is the 29th edition of the OECD Nuclear Energy Agency (NEA) and International Atomic Energy Agency's biennial report. The 568-page report presents the most recent review of world uranium market fundamentals and offers a statistical profile of the uranium industry. It includes 54 country reports on uranium exploration, resources, production and reactor-related requirements, 36 of which were prepared from officially reported government data and narratives, and 18 that were prepared by the NEA and IAEA secretariats.
Overall, global uranium resources decreased "modestly" in the reporting period (January 2019 to January 2021) compared with slight increases in previous recent editions. This was mainly due to mining depletion and cost category re-assignments of resources in Kazakhstan and Canada. However, Australia continues to lead with 28% of the world’s identified recoverable resources. Global expenditures on domestic exploration and mine development decreased to approximately $250m in 2020, continuing a downwards trend.
Total exploration and mine development expenditures from 2018 through 2020 in the reporting countries amounted to $1.25bn, with Canada, China, India, Russia and Kazakhstan leading the way. Expenditures in Canada alone exceeded the total spending of the remaining top five countries and amounted to 44% of the total.
Global uranium mine production decreased by nearly 12% from 2018 to 2020. Major producing countries limited total production in recent years in response to a depressed uranium market and the COVID-19 pandemic in early 2020. As of 1 January 2021, the annual production capacity of idled mines amounted to more than 29 400 tU. The report says these operations could potentially be brought back into production relatively rapidly given appropriate market conditions.
In 2020, 16 countries produced uranium for a global total of 47 432 tU. Kazakhstan remained the world’s largest producer, even as production was eased back from 21 705 tU in 2018 to 19 477 tU in 2020. Kazakhstan’s 2020 production alone totalled more than the combined production in that year from Australia, Namibia, Canada, and Uzbekistan, respectively the second, third, fourth and fifth largest producers of uranium in 2020. These five countries accounted for 81% of global uranium output that year.
World nuclear capacity is expected to rise "for the foreseeable future" and sufficient uranium resources exist to support continued use of nuclear power and significant growth in nuclear capacity for electricity generation and other uses. East Asia is projected to experience the largest increase of generating capacity in absolute terms, which, by 2040, could result in increases of 35-152 GW over 2020 capacity. This corresponds to 130-240% increases in the low and high cases. The report notes: “It is important to note that countries of this region (e.g. China) have in recent years demonstrated the ability to build multiple reactors with predictable costs and schedules.
Other regions projected to experience significant nuclear capacity growth by 2040 include the Middle East, Central and Southern Asia. The low and high cases project an additional growth of 27-51 GW compared with 2020. In Europe, nuclear capacity in non-EU member countries is projected to increase in the high case scenario to 93 GW by 2040. However, in the European Union, nuclear capacity in 2040 is projected to decrease by 25% in the low case scenario and increase only by 16% in the high case. Modest growth in terms of absolute capacity increase is projected in Africa, Central and South America and South-eastern Asia. For North America, the projections see nuclear generating capacity decreasing by 2040 in the low case (-42%) and roughly flat in the high case (+3%).
The report notes: "In 2021 and 2022, the perception of nuclear energy as a strategic resource for energy independence has started to change in many countries, as reflected by recent government nuclear energy policy changes.” This was also due to the European energy crisis of 2022 caused by the shifting geopolitical situation. However, the 2024 edition of the Red Book will aim to provide a fuller picture of the implications of these developments on uranium demand and supply.
The report concludes: “Looking ahead, with the easing of efforts to control the COVID-19 pandemic at production facilities, and the recent run-up in the spot price of uranium in the latter half of 2021, a modest increase in the production of uranium can be expected. However, with ongoing geopolitical tensions that threaten the continuation of some aspects of global trade in nuclear materials, the market's ability to continue supplying an adequate amount of uranium to the global nuclear fuel supply chain will be tested.”