If demand for uranium were to ever flourish like it did for iron ore a few years back, Australia is well positioned to cash in. The industry remains relatively small compared to commodities like gold, copper and even coal, but the potential is there.
During peak periods in 2004 and 2008, uranium prices briefly rose as high as $130 a pound before the trend was disrupted by two major events: the global crisis in 2008 and the Japanese tsunami in 2001.
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Australia is home to some of the largest uranium deposits in the world. BHP Billiton’s Olympic Dam mine in South Australia, Rio Tinto’s Ranger lease in the Northern Territory, and the Four Mile mine in South Australia, run by Quasar and Alliance Resources are just three Australian sites where uranium is now being produced.
According to The Sydney Morning Herald, weak prices for uranium have force mines around the world to close, reducing the number of operating uranium mines in Australia.
Toro Energy, for example, is developing a uranium deposit in Western Australia but is unlikely to be mined unless prices recover significantly.
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"The continued weak uranium prices are having an impact on future supply potential over the long term. In the current low-price environment it is difficult to justify the economics of projects, which is leading to deferrals or even cancellations," said Tim Gitzel, chief executive of the world's second largest uranium producer Cameco.
"64 reactors are under construction around the world today and the new reactors have been coming online, four in China so far this year. So there are things happening that continue to strengthen the long-term outlook and that keeps us excited," Mr Gitzel said last week.
According to The Sydney Morning Herald, UBS analyst Dan Morgan said battery technology could improve the viability of renewable energy, but in the meantime the biggest challenge is community attitudes.
"If battery technology works it could solve some of those questions around renewables but I don't think batteries are the biggest risk to uranium. I think the biggest risk going forward is community opposition to nuclear plants and that is especially so in light of Fukushima," Morgan said.
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"The other problem with nuclear power is it has a large upfront capital cost, which means that it is pretty hard to get a nuclear plant financed. So I think that is also a challenge for uranium."
Many optimists believe the lack of new mines will eventually create a shortage of uranium, helping to stimulate the next uranium price boom.