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North American uranium names rallied in Wednesday’s trading following a surprise increase in extraction taxes in Kazakhstan, the world’s largest uranium-producing country, which BMO Capital analysts said would limit future supply growth.
Big gainers included Uranium Royalty (UROY) +11%, Forsys Metals (OTCPK:FOSYF) +10%, Cameco (CCJ) +9.6%, Denison Mines (DNN) +8.7%, NexGen Energy (NXE) +8.7%, enCore Energy (EU) +8.3%, Uranium Energy (UEC) +8%, Energy Fuels (UUUU) +6.4%, Nuscale Power (SMR) +5.9%, Paladin Energy (OTCQX:PALAF) +5.5%, Ur-Energy (URG) +5%, Fission Uranium (OTCQX:FCUUF) +3.7%, Centrus Energy (LEU) +3%.
ETFs: (NYSEARCA:URA), (NLR), (URNM)
BMO analyst Alexander Pearce said the new mineral extraction tax was a surprise given it was increased in 2023, Bloomberg reported.
The new rates “appear to provide less incentive for Kazatomprom to increase production, in our view, with less penalty for higher uranium prices than production, which could add to support for the uranium price,” Pearce wrote.
