Ben Finegold: Uranium in 2026 — Price Outlook, Plus Stocks, Supply and Demand
Summary
Ben Finegold of Ocean Wall shares his 2026 outlook for uranium supply, demand and prices. In his view, although 2025 brought …
Transcript
I'm Charlotte Mloud with investingnews.com and here today with me is Ben Fineold, head of research at Ocean Wall. Thank you so much for being here. Always great to catch up with you. >> Thanks SH. Thanks for having me back on. >> Of course, we've got a lot to go over in the uranium sector and of course we want to look forward to 2026, but I thought before we do that, we could take a quick look back at 2025. Maybe if you look back at the last 12 months, is there a a word or phrase, how would you sum up the market? >> Uranium wise, it's been it's been mixed um just despite sort of one-way um traffic in terms of the sort of nuclear theme, the wider nuclear theme, you know, uranium, particularly the underlying commodity prices, I would say, have underperformed expectations uh in terms of the spot price. they've definitely underperformed expectations in terms of the spot price. Um, but that doesn't change the the fundamentals of of what we ultimately know is going to happen to to pricing. And again, as your listeners are more than aware, we differentiate between spot and term. Spot prices not done much this year, but but term prices have really started to tick higher in the later sort of uh quarter of this year on some meaningful volumes. But um I think still it's been an incredibly positive year for the underly equities. Uh the equities across the board have had have had very strong years despite the fact that uh the spot price and uh hasn't moved meaningfully. So hopefully 2026 we get continued sort of positive news flow and and ultimately we start to see that positivity move into much higher pricing. I think that's a a good way to sum up the year that we've had and for everyone just to remember the underlying story remains so strong and you've given us a lot of pathways that we can go down. I wanted to start on the demand side particularly with the utilities because I think over this past year the theme that I've been hearing is that they need to come to the market and start contracting but they're not doing it to the extent that many people expected that they would in 2025. So I wondered if you could go into the activity we're seeing from the utilities and and maybe why it hasn't been as as active as people had expected. >> I think 2025 we will look back on as the year where where two things have really changed and this is with a particular view on the US and the western world. We have seen massive regulatory reform from nuclear regulators. So let's focus on the NRC for a second. and the nuclear regulator in the US. Their entire reason for existence is to facilitate new nuclear in a in a in a safe in as safe a way as possible. In my opinion, they have done nothing but prohibit new nuclear for the last two and a half decades. And that has fundamentally changed and I've been lucky enough to see that with my own eyes over the course of this year that the NRC uh have become much more focused on how do we build new nuclear. I think the second thing that's changed is funding and ultimately um the US government um you know the recent pledges $80 billion to Westinghouse $550 billion collaboration with Japan. It's all about moving beyond rhetoric and moving beyond headlines and actually starting to build new nuclear capacity. So in answer to your question, if I'm a US utility and I've been looking at the uranium market, I've been looking at the fuel markets for the last 5 years, the last 25 years in fact, your competitors have not changed at all. you are not competing against 10, 20, 30 new reactors domestically for that fuel. And so I think the mindset of the utilities has been somewhat fair in so much as you know we hear all these headlines, Biden wanted to triple nuclear capacity, Trump wants to quadruple it, 31 countries want to triple it globally, but where are we actually building new nuclear? And the answer really is just in China. And actually if you look at existing operating um nuclear power plants that number uh that sort of on a gigawatt basis has declined since 2020. So so for me looking ahead and looking backwards what changed regulatory reform is definitely one part of it. funding is another is another massive part of it and I I don't think that the hypers scale argument has too much weight here because hypers scalers yes they're funding uh or for recommissionings let's say or life extensions but they're not going to fund first of a kind nuclear power projects would be my guess that they're going to sort of let government take that first of a kind risk and then come into sort of eth of a kite that's when the utility mindset will will change and ultimately I think that that starts now because we've started to we're going to start to see new nuclear reactors being built which will change their competitive landscape for fuel. Um we saw it last month um about 27 million pounds contracted in November. Uh that was about you know it's about a third of all contracted volumes for the entire year done in one month in what is typically a fairly quiet period for for for contracting. We saw very very low contracting volumes coming out of the WNA um week here in London. um where normally you would expect to see pretty high volumes of contracting. So this market always keeps you humble and keeps you guessing as to what the utilities are thinking. But um I I do definitely see um trends working in our favor in terms of high prices. >> Well, and you answered my next question which is going to be or was going to be when that might change for in terms of the utilities. So it seems like something that is happening right now. And I think the other question that people have is all right. So then what will the impact be on prices? You mentioned it's important to differentiate between spot and term. I believe they both been I know term has been higher this year. Spot pretty flat. What as the utilities come back into the market would be the impact on pricing. Well, you know, we can look backwards and say that when you had 10% of future production in jeopardy in 2007 via Cigar Lake, you saw a 3 400% increase in in uranium prices. Um, I think that what's going to matter here is the extent to which utilities are uncovered. Um if you listen to what Chemico say 67% uh utilities are uncovered for 67% the uranium requirements in the next two decades. So if you start to see utilities move in a herd together as they often do then the impact on pricing spot and term will be profound. um spot market transactions this year. You know, I think Sprat have accounted for about 15%. So, it's not been a bump a year for them in terms of in terms of uh procurement. Um but but what's going to have what's going to make uranium prices go higher for longer is utilities. It's not going to be traders trading £250,000 here or there. It's just not a liquid enough market for them. Um it's going to have to be utilities where their RFPs in the turn market are not getting filled when they go out to their producers and say guys I need4 million pounds for 27 to 2030 delivery and those phone calls say no uh we are completely contracted out and we know people like Kamakov who have pretty much sold out for their uranium through 28 29 when those contracts don't get filled you're forced into the spot market for near-term delivery and when you start to see utilities moving into the spot market in numbers. That's where we're going to see 100, 150, $200 a pound in uranium prices and and they'll stay up for a while. >> Right. And in terms of the utilities, I I wanted to talk a little bit about the life extensions that we're seeing. I think maybe in the past there's been more focus on new reactors, etc., and now we're hearing more about these life extensions. I wondered if you could talk about how impactful that is going to be for the market moving forward. >> So the life extension story is profound because it's near-term demand for uranium. So so these so these reactors that run down inventories to zero in terms of their fuel that are then being told they want to operate or or that there's someone there, you know, wanting to operate them um for another 20 years. they then have that creates new incremental demand straight away. Um that is not like a okay we want to build a new nuclear project in Illinois and it might come online in 2033 so let's start contracting for our fuel at 28 or 27. Um that has been the lowhanging fruit for let's call it um let's call it additional nuclear capacity cuz it's not new nuclear capacity particularly in the US. Um but inherently uh extensions, restarts, they are finite by by their very nature. So when we think about the amount of new capacity or the amount of additional capacity that can come online from those, we're definitely not there yet. Um you know, we're going to see many many more extensions for many years to come. Um but um the important thing is when you look at uranium supply demand models, those are not really factored in. There are certain high-profile cases, think Diablo came, three mile island, Dwayne Dwayne Arnold, um that that that are sort of the flagship names, VC summer, where we're going to see near-term uranium demand. But there are plenty more um plants, reactors coming offline in the next 10 years that that we expect to see life extensions, which we expect to see have a a significant impact on near-term uranium demand. >> So, a a key part of the market to watch. And on the demand side, the other thing I wanted to bring up is there's been a lot of hype about how AI demand could impact the nuclear sector. And I I know that right now there is also a lot of talk about an AI bubble. And typically when it comes to uranium, I hear that AI is kind of, you know, the cherry on top of everything else. The sector doesn't need the AI demand. It was already doing fine without it. But I wonder when you look at these bubble concerns for AI, is that something that could impact the sector or or should we not worry about it? >> There is no way that if an AI bubble burst that nuclear stocks don't correct with them. Um nuclear stocks have become somewhat correlated to AI. Some of them much more so than others. Think an Olo versus a Paladin. So an oplo which has become pretty much correlation one in my view to to AI. Um so nuclear stock will correct if I if if that comes but I think the most important thing that you said which is 100% true is the nuclear thesis is not contingent on AI. There was a nuclear renaissance long before the hyperscalers and their ferocious appetite for power came to the grid. They are, yes, the least price sensitive customers on the grid, but even they're not willing to underwrite first of a kind uh risk. They're looking at the lowhanging fruit like Microsoft King Three Mile Island. So, if that bubble bursts, then we might see a temporary correction and I think that actually it could be the end for some for some names that that that have that very high correlation to AI. And there are these companies that you talk about where there's an AI boom, everyone's an AI company. Where there's a nuclear boom, everyone's a nuclear company. And there are certain nuclear companies out there that are just not real nuclear companies that that are trying to hop on this sort of bandwagon. So those are the companies that I would be wary of um sort of heading into whether you take a view there's an AI sort of bubble burst coming and actually when you own high quality nuclear names high quality nuclear fuel names upstream downstream and these things correct 10 15 20% whatever they correct if and when this eventuality comes then that's an amazing buy opportunity which which this sector tends to hand you a couple of times a year. um uh non-fundamental um indiscriminate sell-offs across quality names and lowquality names. >> Right. That's what I was thinking as you're talking. It sounds like that would be a buying opportunity, but as you said, not not for everything. So maybe it's a a good time to ask where your focus is right now. Where do you see the most value in the uranium equities at the moment? So for us, we're still uh the delta 1 trade here is still playing via spot pricing um and still trying to make sure that where we want to take gearing via the miners that that we are aligning ourselves to the highest quality companies. So for us we look at really simple metrics like market cap versus pounds out the ground and then we factor in a geopolitical risk discount. Um I think you know take an example of Nijair where if you did that for somewhere like global atomic global atomic looks you know on a forward view fundamentally very very cheap if they're able to to to ramp up data to where they think they can but the geo the baked in geopolitical risk is just too high for us to underwrite and for us to feel comfortable with. I feel and have always felt pretty similarly about kazaten prom. I think for the risk you take it's pretty low beta to the market. Um yes it's the cheapest uranium company in the world. Um I I would agree with that on a pounds out the ground basis. It pays a nice dividend but for us I we don't want to underwrite the risk of what you know what we have seen is increased risk of nationalization of their uranium assets only a couple of weeks ago talking about needing 90% um uh the sort of ownership of of their domestic assets. So for us North America is where we're most comfortable. I would say also certain names in Australia and Namibia. Um but the US premium in particular for us is massively in focus. Tried to find names where we think that um that are going to capture that premium. The US 20% of their grid is nuclear. Um 55% of their clean power is nuclear. And in 2024 they relied on imports for 99% of their nuclear fuel. this year effort for their uranium and for this year it's going to be about 98% call it 97 12%. They are utterly reliant on imports for uranium which is the only way to fuel 20% of their grid. You see what happened to to to German gas prices post Russia's invasion of Ukraine. This didn't move from 30 to 40 to 50. It moved from 30 to a,000. And is it is that convexity that we want to be able to to capture. Um so so US uranium names absolutely in focus and and I think as well Canadian you can put into that and probably Australian to sort of a third derivative but I think the US the US names are where you can really capture the premium names like um uh we think massively underappreciated names like Premier American uranium which basically gets treated like an exploration company in terms of its market cap but has 18 million pounds in the ground. We have a a relationship with them to be clear, but but for us that's a that's a name that where we have complete conviction. Um we love any uh US producers that can genuinely produce uranium because they're the ones that are going to be able to capture pounds, but we're also very happy to take some exploration risk where we have high conviction. And then just finally looking sort of up towards the enrichment side with very few ways to get public market exposure to the enrichment theme. Sil centurus ASPI sort of QLE um for us you know ASPI has been unlocked for too long now um despite the fact that their crown jewel via their terra power agreement for $3.75 billion worth of Halo uh remains inside the business that for us remains an exciting way to play this theme centrus has made great strides in its Halo business getting I think over a ton of of Halo now produced but for us has some drawbacks in terms of capital efficiency of centrifuges and Russia accounting for about 90% of revenues and again we commend Sylex on uh achieving TRL6 this year but for their their laser based enrichment methods. So these are all companies that we that we watch and monitor on a daily basis. >> That's a a great overview of how you're looking at the sector right now and I appreciate that you go up and down the chain there. So thank you for that. I do want to go back to what's happening in Kazakhstan with the subs soil use code you mentioned that was a couple of weeks ago quite a big change over there. I was trying to read up on this and it's a little bit tricky to get information. So I wondered if you could break down what's happening there and the potential impact for the uranium market. >> So Kazakhstan is 40% of global uranium supply. They are just the the 800 lb gorilla in terms of uranium production. And what they're doing, I don't think is anything out of the ordinary. Uh they are trying to monetize that dominant position that they have in uranium markets. We saw it last year with the um with the um mineral extraction taxes that that that they placed on on uh producing assets in the country which I think you know took Camo by surprise that sort of ramps up over the next couple of years. And then what we've seen now with changes to the subs soil use agreements is essentially when a JB comes up for renewal. The Russians own about 20% of uh they have JB interest about 20% of all production all assets in Kazakhstan. The Chinese about 5% Orano Kamako will have interests when those contracts come up for renewal. Essentially what they're saying is Kazakhstan will be taking uh at least a 90% ownership in those. Now, as I understand it, there are exemptions to that, particularly for sort of technology share around conversion and enrichment. So, Kazakhstan or Kazat have always made it clear that that their intention is not just to kind of to be a uranium mining business, but to be an integrated nuclear fuel supplier to the world. And so, anything that let's say the Russians can do to export conversion enrichment technology to Kazakhstan um is where I think you can go down to about 75% um ownership. This is about Kazakhstan taking taking control of their assets. Um, as as they have said, you know, legacy assets, legacy agreements that had been signed back in the '90s were not favorable enough to the country. And this and this is about them not not letting that happen. Um, again, ultimately this comes down to the fact that they have a significant uh reduction in production capacity coming quite soon. um unless they're able to bring online new large assets, the production profile for Kazatimrom really looks almost linear to the downside between now and 2050. Um so it's about trying to diversify away from that and also to capture what's going to be a you know in our view a generational moment for nuclear for nuclear fuel and to be able to monetize that properly. >> Well and and that's interesting. So would you see bigger producers right now going out to acquire smaller companies? Is that something you think is on their mind at the moment? Consolidation will play a m will play a role for sure. I think again something that the market is not talking about enough is is China. Um China operates a uh basically a strategy where they that they can uh produce a third of their uranium domestically. They want to um have JB interest in international uranium assets for a third of what they need domestically and then they buy in the market a third of what they need. and they're actually only producing about 9% of what they need domestically for their reactor fleet. So they're really relying on international JVS to be able to to sort of fill that gap and and there's obviously a lot of collaboration between them and the Kazaks. Their uh uranium company which is a subsidiary of CNNC went public at a 20 billion well at the end of the day was a $20 billion valuation. The shares are up about 250% on the day. They said their intention is to go out and they started off mainly in inner Mongolia and with domestic assets with the money that they raised. I think it was about 5600 million. Um and then they said this is now a starter to go out and acquire international assets. So whether it's companies, assets, whatever you want to call it, the Chinese are going to be playing a much more active role. We think internationally in terms of buying up uranium assets, they already have a very strong presence in Africa and Kazakhstan as well. But in terms of let's say the listed stocks, yes, I I think this will come. But um you know the real consolidation period will come when when we have significantly higher pricing. I think right now where you know it it's been few and far between in terms of sort of M&A and and yeah larger companies buying the juniors, but that will come. >> Yeah. Yeah. Further further down the chain sounds more likely. If we were putting this all together, we focused pretty heavily on demand. On the supply side, I know we've had some surprises to the downside from the big producers, the development companies. They are it's hard for companies to bring projects online. The whole mining is hardline. So, as we're heading into 2026, what is the supply demand balance really looking like for uranium? Well, it will look one way and as you say, it will end up being something completely different most likely. Um, you know, because atom have removed guidance for 2026. So, so it's really it's probably harder than ever to have an accurate gauge on what's going to come out of in terms of primary production next year. My guess is that it's going to be pretty flat in terms of production this year. So call it 65 um call it 6570 million pounds of production from from Kazakhstan. Um so so you know we're estimating about 160 165 million pounds of primary supply um in in 2026 from from existing uranium mines. That factors in a a tiny discount in terms of some of the ramp ups that we have already seen struggling. Then the demand side has stayed sort of pretty stable. on call it 185 uh 180 185 million pounds primary demand. So there still exists uh call it a 20 million pound deficit in the market. We see this as a cumulative deficit between now and 30 uh 2035 of about£300 million. Um ultimately this can be exacerbated by various things which is new mines coming off new minds trying to come online not meeting those production ramp up schedules. Um and actually when you look at existing primary supply that actually starts to fall um from existing mines next year. Um so we're really going to be solely reliant on these new builds to come online and as you said mining is hard um even brownfield sites that they've got historic data sets, they got historic labor force, they've got everything they need, they've got the pricing incentives. These guys are all all struggling to to to meet ramp up targets. So why should nextg the Dennison's um be any different? >> Yeah. Yeah, that's a tricky situation to watch. And is it really these these ramp up struggles? Is it really just a case of mining is hard or is there anything specific that's going on here that people should be aware of? So high level, there's not a commodity in the world where you see prices go up four times as they have since the late teens and you've seen supply increase 25 30%. It it just does it doesn't happen in any other commodity. So what is it that what is it that makes that makes that so difficult? The truth is is because we don't build uranium mines. We have we we don't have m 62% of global uranium production comes from just 10 miles. you just have two operating mines in Canada. They're over 20% of global production. Um so, so you have this very very high concentration risk and ultimately a concentration premium. Um because people don't really know how to license, how to permit these mines. Uranium is a class is classified as a class 7 transit material. This makes the permitting process much more complex versus a precious metal because ultimately of what it can be used for. Um, and there's not a regulatory framework where you'll have a regulatory framework in South Africa or a regulatory framework in Canada that they sit there all day and they just approve gold mines or they approved silver mines and copper mines and cobalt mines. That doesn't exist in uranium. We haven't approved we haven't been we haven't actually brought online a new mine since 2016. Um uh uh so so it's really um I think it's down to regulatory primarily but also the fact that mining is hard is not exclusive to to uranium. You know you see this across pretty much all metals. Um I just think that there is not 100 mines sat there idly waiting to come online. Um we are really solely reliant globally on four or five new mines coming online in the next 5 years to even come close to to filling that gap. And the truth is even if they all come online on time or budget, then there's still going to be a cumulative deficit of of about 100 million pound from the next 10 years. >> Yeah, I think that really helps to put it into perspective. And as we start to wrap up here, I think I always say this, uranium investors seem very savvy. They're often very aware of what's going on in the market. But for you, are there any overlooked factors right now that you think people should be aware of heading into 2026? I think the the Kazak news fell on deaf ears completely. Um this is about the Kazaks really the next stage of nationalizing their uranium assets. Market didn't really seem to care about that. We monitor Kazak uranium exports. They're really exporting the overwhelming majority of their of their production to just China and Russia alone. I think people don't talk about India nearly enough. India for a country that wants to increase nuclear capacity 10fold by 2047. that has not started its procurement program. Uh you saw us you sort of started to see more of a collaboration between them and and and Kamako for I think it was $2.8 billion contract. Um I think that slightly fell on on deaf ears. And I also think the China news um um about uh about their national uranium company from CNNC market's not talking about the fact that China has just raised 6700 billion um and they said this is a starter and we're going to go out and buy as many uranium assets internationally as we possibly can. The fact the shares are up 280% on debut uh when I last looked um shows you exactly what the domestic institutions in China thought about that deal. So, there's a few things that don't get the mainstream coverage, but ultimately, and maybe a fourth thing is is is tail volumes. A huge spike in tunnel volumes for November. Um, and ultimately, we're now at $86 a pound um term pricing. We had a year-end target of $90 a pound for term prices. I wouldn't be surprised to see somewhere, you know, somewhere pretty close to that um when we get uh numbers on the 29th of December. Certainly, I think all of those sound like important factors to watch. And I'll let you go unless you had any final points that you wanted to leave investors with when it comes to uranium. I >> I think the final thing is we've had a great year. Uh uranium equities have had a great year and spot prices haven't really moved. So, um there is no reason why this positive momentum will not change next year for nuclear. The whatever volatility we're going to have in AI is going to happen. That's just the the kind of sector it is. The nuclear thesis is not going anywhere anytime soon. So, anytime that you get those non-fundamental opportunities to be buying these stocks, um it just goes back to that fundamental research that we do that I'm sure your listeners all do. Um this is going to be a generational opportunity for us to invest in in uranium. There is no other commodity that behaves like it. Um, and I think that next year we're going to get our double bump of higher pricing, favorable market conditions, strong fundamentals, positive news flow. Um, and it's going to come together and and it's going to be another good year for for your equities. >> Well, I certainly I really hope so. And thank you so much for coming on to go over what's happening in the markets. This was great. >> Absolutely. Thanks for having me on in, Charlotte. >> Of course. And once again, I'm Charlotte Mloud with investingnews.com and this has been Fineold with Ocean Wall. Thank you for watching. If you like this video, make sure you hit the like button and subscribe to our channel. We'd also love to hear your thoughts, so leave us a comment below.
Ben Finegold: Uranium in 2026 — Price Outlook, Plus Stocks, Supply and Demand
Summary
Ben Finegold of Ocean Wall shares his 2026 outlook for uranium supply, demand and prices. In his view, although 2025 brought …Transcript
I'm Charlotte Mloud with investingnews.com and here today with me is Ben Fineold, head of research at Ocean Wall. Thank you so much for being here. Always great to catch up with you. >> Thanks SH. Thanks for having me back on. >> Of course, we've got a lot to go over in the uranium sector and of course we want to look forward to 2026, but I thought before we do that, we could take a quick look back at 2025. Maybe if you look back at the last 12 months, is there a a word or phrase, how would you sum up the market? >> Uranium wise, it's been it's been mixed um just despite sort of one-way um traffic in terms of the sort of nuclear theme, the wider nuclear theme, you know, uranium, particularly the underlying commodity prices, I would say, have underperformed expectations uh in terms of the spot price. they've definitely underperformed expectations in terms of the spot price. Um, but that doesn't change the the fundamentals of of what we ultimately know is going to happen to to pricing. And again, as your listeners are more than aware, we differentiate between spot and term. Spot prices not done much this year, but but term prices have really started to tick higher in the later sort of uh quarter of this year on some meaningful volumes. But um I think still it's been an incredibly positive year for the underly equities. Uh the equities across the board have had have had very strong years despite the fact that uh the spot price and uh hasn't moved meaningfully. So hopefully 2026 we get continued sort of positive news flow and and ultimately we start to see that positivity move into much higher pricing. I think that's a a good way to sum up the year that we've had and for everyone just to remember the underlying story remains so strong and you've given us a lot of pathways that we can go down. I wanted to start on the demand side particularly with the utilities because I think over this past year the theme that I've been hearing is that they need to come to the market and start contracting but they're not doing it to the extent that many people expected that they would in 2025. So I wondered if you could go into the activity we're seeing from the utilities and and maybe why it hasn't been as as active as people had expected. >> I think 2025 we will look back on as the year where where two things have really changed and this is with a particular view on the US and the western world. We have seen massive regulatory reform from nuclear regulators. So let's focus on the NRC for a second. and the nuclear regulator in the US. Their entire reason for existence is to facilitate new nuclear in a in a in a safe in as safe a way as possible. In my opinion, they have done nothing but prohibit new nuclear for the last two and a half decades. And that has fundamentally changed and I've been lucky enough to see that with my own eyes over the course of this year that the NRC uh have become much more focused on how do we build new nuclear. I think the second thing that's changed is funding and ultimately um the US government um you know the recent pledges $80 billion to Westinghouse $550 billion collaboration with Japan. It's all about moving beyond rhetoric and moving beyond headlines and actually starting to build new nuclear capacity. So in answer to your question, if I'm a US utility and I've been looking at the uranium market, I've been looking at the fuel markets for the last 5 years, the last 25 years in fact, your competitors have not changed at all. you are not competing against 10, 20, 30 new reactors domestically for that fuel. And so I think the mindset of the utilities has been somewhat fair in so much as you know we hear all these headlines, Biden wanted to triple nuclear capacity, Trump wants to quadruple it, 31 countries want to triple it globally, but where are we actually building new nuclear? And the answer really is just in China. And actually if you look at existing operating um nuclear power plants that number uh that sort of on a gigawatt basis has declined since 2020. So so for me looking ahead and looking backwards what changed regulatory reform is definitely one part of it. funding is another is another massive part of it and I I don't think that the hypers scale argument has too much weight here because hypers scalers yes they're funding uh or for recommissionings let's say or life extensions but they're not going to fund first of a kind nuclear power projects would be my guess that they're going to sort of let government take that first of a kind risk and then come into sort of eth of a kite that's when the utility mindset will will change and ultimately I think that that starts now because we've started to we're going to start to see new nuclear reactors being built which will change their competitive landscape for fuel. Um we saw it last month um about 27 million pounds contracted in November. Uh that was about you know it's about a third of all contracted volumes for the entire year done in one month in what is typically a fairly quiet period for for for contracting. We saw very very low contracting volumes coming out of the WNA um week here in London. um where normally you would expect to see pretty high volumes of contracting. So this market always keeps you humble and keeps you guessing as to what the utilities are thinking. But um I I do definitely see um trends working in our favor in terms of high prices. >> Well, and you answered my next question which is going to be or was going to be when that might change for in terms of the utilities. So it seems like something that is happening right now. And I think the other question that people have is all right. So then what will the impact be on prices? You mentioned it's important to differentiate between spot and term. I believe they both been I know term has been higher this year. Spot pretty flat. What as the utilities come back into the market would be the impact on pricing. Well, you know, we can look backwards and say that when you had 10% of future production in jeopardy in 2007 via Cigar Lake, you saw a 3 400% increase in in uranium prices. Um, I think that what's going to matter here is the extent to which utilities are uncovered. Um if you listen to what Chemico say 67% uh utilities are uncovered for 67% the uranium requirements in the next two decades. So if you start to see utilities move in a herd together as they often do then the impact on pricing spot and term will be profound. um spot market transactions this year. You know, I think Sprat have accounted for about 15%. So, it's not been a bump a year for them in terms of in terms of uh procurement. Um but but what's going to have what's going to make uranium prices go higher for longer is utilities. It's not going to be traders trading £250,000 here or there. It's just not a liquid enough market for them. Um it's going to have to be utilities where their RFPs in the turn market are not getting filled when they go out to their producers and say guys I need4 million pounds for 27 to 2030 delivery and those phone calls say no uh we are completely contracted out and we know people like Kamakov who have pretty much sold out for their uranium through 28 29 when those contracts don't get filled you're forced into the spot market for near-term delivery and when you start to see utilities moving into the spot market in numbers. That's where we're going to see 100, 150, $200 a pound in uranium prices and and they'll stay up for a while. >> Right. And in terms of the utilities, I I wanted to talk a little bit about the life extensions that we're seeing. I think maybe in the past there's been more focus on new reactors, etc., and now we're hearing more about these life extensions. I wondered if you could talk about how impactful that is going to be for the market moving forward. >> So the life extension story is profound because it's near-term demand for uranium. So so these so these reactors that run down inventories to zero in terms of their fuel that are then being told they want to operate or or that there's someone there, you know, wanting to operate them um for another 20 years. they then have that creates new incremental demand straight away. Um that is not like a okay we want to build a new nuclear project in Illinois and it might come online in 2033 so let's start contracting for our fuel at 28 or 27. Um that has been the lowhanging fruit for let's call it um let's call it additional nuclear capacity cuz it's not new nuclear capacity particularly in the US. Um but inherently uh extensions, restarts, they are finite by by their very nature. So when we think about the amount of new capacity or the amount of additional capacity that can come online from those, we're definitely not there yet. Um you know, we're going to see many many more extensions for many years to come. Um but um the important thing is when you look at uranium supply demand models, those are not really factored in. There are certain high-profile cases, think Diablo came, three mile island, Dwayne Dwayne Arnold, um that that that are sort of the flagship names, VC summer, where we're going to see near-term uranium demand. But there are plenty more um plants, reactors coming offline in the next 10 years that that we expect to see life extensions, which we expect to see have a a significant impact on near-term uranium demand. >> So, a a key part of the market to watch. And on the demand side, the other thing I wanted to bring up is there's been a lot of hype about how AI demand could impact the nuclear sector. And I I know that right now there is also a lot of talk about an AI bubble. And typically when it comes to uranium, I hear that AI is kind of, you know, the cherry on top of everything else. The sector doesn't need the AI demand. It was already doing fine without it. But I wonder when you look at these bubble concerns for AI, is that something that could impact the sector or or should we not worry about it? >> There is no way that if an AI bubble burst that nuclear stocks don't correct with them. Um nuclear stocks have become somewhat correlated to AI. Some of them much more so than others. Think an Olo versus a Paladin. So an oplo which has become pretty much correlation one in my view to to AI. Um so nuclear stock will correct if I if if that comes but I think the most important thing that you said which is 100% true is the nuclear thesis is not contingent on AI. There was a nuclear renaissance long before the hyperscalers and their ferocious appetite for power came to the grid. They are, yes, the least price sensitive customers on the grid, but even they're not willing to underwrite first of a kind uh risk. They're looking at the lowhanging fruit like Microsoft King Three Mile Island. So, if that bubble bursts, then we might see a temporary correction and I think that actually it could be the end for some for some names that that that have that very high correlation to AI. And there are these companies that you talk about where there's an AI boom, everyone's an AI company. Where there's a nuclear boom, everyone's a nuclear company. And there are certain nuclear companies out there that are just not real nuclear companies that that are trying to hop on this sort of bandwagon. So those are the companies that I would be wary of um sort of heading into whether you take a view there's an AI sort of bubble burst coming and actually when you own high quality nuclear names high quality nuclear fuel names upstream downstream and these things correct 10 15 20% whatever they correct if and when this eventuality comes then that's an amazing buy opportunity which which this sector tends to hand you a couple of times a year. um uh non-fundamental um indiscriminate sell-offs across quality names and lowquality names. >> Right. That's what I was thinking as you're talking. It sounds like that would be a buying opportunity, but as you said, not not for everything. So maybe it's a a good time to ask where your focus is right now. Where do you see the most value in the uranium equities at the moment? So for us, we're still uh the delta 1 trade here is still playing via spot pricing um and still trying to make sure that where we want to take gearing via the miners that that we are aligning ourselves to the highest quality companies. So for us we look at really simple metrics like market cap versus pounds out the ground and then we factor in a geopolitical risk discount. Um I think you know take an example of Nijair where if you did that for somewhere like global atomic global atomic looks you know on a forward view fundamentally very very cheap if they're able to to to ramp up data to where they think they can but the geo the baked in geopolitical risk is just too high for us to underwrite and for us to feel comfortable with. I feel and have always felt pretty similarly about kazaten prom. I think for the risk you take it's pretty low beta to the market. Um yes it's the cheapest uranium company in the world. Um I I would agree with that on a pounds out the ground basis. It pays a nice dividend but for us I we don't want to underwrite the risk of what you know what we have seen is increased risk of nationalization of their uranium assets only a couple of weeks ago talking about needing 90% um uh the sort of ownership of of their domestic assets. So for us North America is where we're most comfortable. I would say also certain names in Australia and Namibia. Um but the US premium in particular for us is massively in focus. Tried to find names where we think that um that are going to capture that premium. The US 20% of their grid is nuclear. Um 55% of their clean power is nuclear. And in 2024 they relied on imports for 99% of their nuclear fuel. this year effort for their uranium and for this year it's going to be about 98% call it 97 12%. They are utterly reliant on imports for uranium which is the only way to fuel 20% of their grid. You see what happened to to to German gas prices post Russia's invasion of Ukraine. This didn't move from 30 to 40 to 50. It moved from 30 to a,000. And is it is that convexity that we want to be able to to capture. Um so so US uranium names absolutely in focus and and I think as well Canadian you can put into that and probably Australian to sort of a third derivative but I think the US the US names are where you can really capture the premium names like um uh we think massively underappreciated names like Premier American uranium which basically gets treated like an exploration company in terms of its market cap but has 18 million pounds in the ground. We have a a relationship with them to be clear, but but for us that's a that's a name that where we have complete conviction. Um we love any uh US producers that can genuinely produce uranium because they're the ones that are going to be able to capture pounds, but we're also very happy to take some exploration risk where we have high conviction. And then just finally looking sort of up towards the enrichment side with very few ways to get public market exposure to the enrichment theme. Sil centurus ASPI sort of QLE um for us you know ASPI has been unlocked for too long now um despite the fact that their crown jewel via their terra power agreement for $3.75 billion worth of Halo uh remains inside the business that for us remains an exciting way to play this theme centrus has made great strides in its Halo business getting I think over a ton of of Halo now produced but for us has some drawbacks in terms of capital efficiency of centrifuges and Russia accounting for about 90% of revenues and again we commend Sylex on uh achieving TRL6 this year but for their their laser based enrichment methods. So these are all companies that we that we watch and monitor on a daily basis. >> That's a a great overview of how you're looking at the sector right now and I appreciate that you go up and down the chain there. So thank you for that. I do want to go back to what's happening in Kazakhstan with the subs soil use code you mentioned that was a couple of weeks ago quite a big change over there. I was trying to read up on this and it's a little bit tricky to get information. So I wondered if you could break down what's happening there and the potential impact for the uranium market. >> So Kazakhstan is 40% of global uranium supply. They are just the the 800 lb gorilla in terms of uranium production. And what they're doing, I don't think is anything out of the ordinary. Uh they are trying to monetize that dominant position that they have in uranium markets. We saw it last year with the um with the um mineral extraction taxes that that that they placed on on uh producing assets in the country which I think you know took Camo by surprise that sort of ramps up over the next couple of years. And then what we've seen now with changes to the subs soil use agreements is essentially when a JB comes up for renewal. The Russians own about 20% of uh they have JB interest about 20% of all production all assets in Kazakhstan. The Chinese about 5% Orano Kamako will have interests when those contracts come up for renewal. Essentially what they're saying is Kazakhstan will be taking uh at least a 90% ownership in those. Now, as I understand it, there are exemptions to that, particularly for sort of technology share around conversion and enrichment. So, Kazakhstan or Kazat have always made it clear that that their intention is not just to kind of to be a uranium mining business, but to be an integrated nuclear fuel supplier to the world. And so, anything that let's say the Russians can do to export conversion enrichment technology to Kazakhstan um is where I think you can go down to about 75% um ownership. This is about Kazakhstan taking taking control of their assets. Um, as as they have said, you know, legacy assets, legacy agreements that had been signed back in the '90s were not favorable enough to the country. And this and this is about them not not letting that happen. Um, again, ultimately this comes down to the fact that they have a significant uh reduction in production capacity coming quite soon. um unless they're able to bring online new large assets, the production profile for Kazatimrom really looks almost linear to the downside between now and 2050. Um so it's about trying to diversify away from that and also to capture what's going to be a you know in our view a generational moment for nuclear for nuclear fuel and to be able to monetize that properly. >> Well and and that's interesting. So would you see bigger producers right now going out to acquire smaller companies? Is that something you think is on their mind at the moment? Consolidation will play a m will play a role for sure. I think again something that the market is not talking about enough is is China. Um China operates a uh basically a strategy where they that they can uh produce a third of their uranium domestically. They want to um have JB interest in international uranium assets for a third of what they need domestically and then they buy in the market a third of what they need. and they're actually only producing about 9% of what they need domestically for their reactor fleet. So they're really relying on international JVS to be able to to sort of fill that gap and and there's obviously a lot of collaboration between them and the Kazaks. Their uh uranium company which is a subsidiary of CNNC went public at a 20 billion well at the end of the day was a $20 billion valuation. The shares are up about 250% on the day. They said their intention is to go out and they started off mainly in inner Mongolia and with domestic assets with the money that they raised. I think it was about 5600 million. Um and then they said this is now a starter to go out and acquire international assets. So whether it's companies, assets, whatever you want to call it, the Chinese are going to be playing a much more active role. We think internationally in terms of buying up uranium assets, they already have a very strong presence in Africa and Kazakhstan as well. But in terms of let's say the listed stocks, yes, I I think this will come. But um you know the real consolidation period will come when when we have significantly higher pricing. I think right now where you know it it's been few and far between in terms of sort of M&A and and yeah larger companies buying the juniors, but that will come. >> Yeah. Yeah. Further further down the chain sounds more likely. If we were putting this all together, we focused pretty heavily on demand. On the supply side, I know we've had some surprises to the downside from the big producers, the development companies. They are it's hard for companies to bring projects online. The whole mining is hardline. So, as we're heading into 2026, what is the supply demand balance really looking like for uranium? Well, it will look one way and as you say, it will end up being something completely different most likely. Um, you know, because atom have removed guidance for 2026. So, so it's really it's probably harder than ever to have an accurate gauge on what's going to come out of in terms of primary production next year. My guess is that it's going to be pretty flat in terms of production this year. So call it 65 um call it 6570 million pounds of production from from Kazakhstan. Um so so you know we're estimating about 160 165 million pounds of primary supply um in in 2026 from from existing uranium mines. That factors in a a tiny discount in terms of some of the ramp ups that we have already seen struggling. Then the demand side has stayed sort of pretty stable. on call it 185 uh 180 185 million pounds primary demand. So there still exists uh call it a 20 million pound deficit in the market. We see this as a cumulative deficit between now and 30 uh 2035 of about£300 million. Um ultimately this can be exacerbated by various things which is new mines coming off new minds trying to come online not meeting those production ramp up schedules. Um and actually when you look at existing primary supply that actually starts to fall um from existing mines next year. Um so we're really going to be solely reliant on these new builds to come online and as you said mining is hard um even brownfield sites that they've got historic data sets, they got historic labor force, they've got everything they need, they've got the pricing incentives. These guys are all all struggling to to to meet ramp up targets. So why should nextg the Dennison's um be any different? >> Yeah. Yeah, that's a tricky situation to watch. And is it really these these ramp up struggles? Is it really just a case of mining is hard or is there anything specific that's going on here that people should be aware of? So high level, there's not a commodity in the world where you see prices go up four times as they have since the late teens and you've seen supply increase 25 30%. It it just does it doesn't happen in any other commodity. So what is it that what is it that makes that makes that so difficult? The truth is is because we don't build uranium mines. We have we we don't have m 62% of global uranium production comes from just 10 miles. you just have two operating mines in Canada. They're over 20% of global production. Um so, so you have this very very high concentration risk and ultimately a concentration premium. Um because people don't really know how to license, how to permit these mines. Uranium is a class is classified as a class 7 transit material. This makes the permitting process much more complex versus a precious metal because ultimately of what it can be used for. Um, and there's not a regulatory framework where you'll have a regulatory framework in South Africa or a regulatory framework in Canada that they sit there all day and they just approve gold mines or they approved silver mines and copper mines and cobalt mines. That doesn't exist in uranium. We haven't approved we haven't been we haven't actually brought online a new mine since 2016. Um uh uh so so it's really um I think it's down to regulatory primarily but also the fact that mining is hard is not exclusive to to uranium. You know you see this across pretty much all metals. Um I just think that there is not 100 mines sat there idly waiting to come online. Um we are really solely reliant globally on four or five new mines coming online in the next 5 years to even come close to to filling that gap. And the truth is even if they all come online on time or budget, then there's still going to be a cumulative deficit of of about 100 million pound from the next 10 years. >> Yeah, I think that really helps to put it into perspective. And as we start to wrap up here, I think I always say this, uranium investors seem very savvy. They're often very aware of what's going on in the market. But for you, are there any overlooked factors right now that you think people should be aware of heading into 2026? I think the the Kazak news fell on deaf ears completely. Um this is about the Kazaks really the next stage of nationalizing their uranium assets. Market didn't really seem to care about that. We monitor Kazak uranium exports. They're really exporting the overwhelming majority of their of their production to just China and Russia alone. I think people don't talk about India nearly enough. India for a country that wants to increase nuclear capacity 10fold by 2047. that has not started its procurement program. Uh you saw us you sort of started to see more of a collaboration between them and and and Kamako for I think it was $2.8 billion contract. Um I think that slightly fell on on deaf ears. And I also think the China news um um about uh about their national uranium company from CNNC market's not talking about the fact that China has just raised 6700 billion um and they said this is a starter and we're going to go out and buy as many uranium assets internationally as we possibly can. The fact the shares are up 280% on debut uh when I last looked um shows you exactly what the domestic institutions in China thought about that deal. So, there's a few things that don't get the mainstream coverage, but ultimately, and maybe a fourth thing is is is tail volumes. A huge spike in tunnel volumes for November. Um, and ultimately, we're now at $86 a pound um term pricing. We had a year-end target of $90 a pound for term prices. I wouldn't be surprised to see somewhere, you know, somewhere pretty close to that um when we get uh numbers on the 29th of December. Certainly, I think all of those sound like important factors to watch. And I'll let you go unless you had any final points that you wanted to leave investors with when it comes to uranium. I >> I think the final thing is we've had a great year. Uh uranium equities have had a great year and spot prices haven't really moved. So, um there is no reason why this positive momentum will not change next year for nuclear. The whatever volatility we're going to have in AI is going to happen. That's just the the kind of sector it is. The nuclear thesis is not going anywhere anytime soon. So, anytime that you get those non-fundamental opportunities to be buying these stocks, um it just goes back to that fundamental research that we do that I'm sure your listeners all do. Um this is going to be a generational opportunity for us to invest in in uranium. There is no other commodity that behaves like it. Um, and I think that next year we're going to get our double bump of higher pricing, favorable market conditions, strong fundamentals, positive news flow. Um, and it's going to come together and and it's going to be another good year for for your equities. >> Well, I certainly I really hope so. And thank you so much for coming on to go over what's happening in the markets. This was great. >> Absolutely. Thanks for having me on in, Charlotte. >> Of course. And once again, I'm Charlotte Mloud with investingnews.com and this has been Fineold with Ocean Wall. Thank you for watching. If you like this video, make sure you hit the like button and subscribe to our channel. We'd also love to hear your thoughts, so leave us a comment below.