where is this write-up? I'm concerned about the timing also. I would prefer it's much later rather than sooner.

You load up after the down?

When they shut them down how long does it typically take to get them ramped up again?

Ok so does that put more pressure on local US sourcing from Canada and thus those stocks trade up more eventually? Much of the growth is in China and India apparently but not sure how much of their supply will come from Canada and the West versus Kazakhstan. Thx

ok since we're splitting hairs it's 3x the current price if we get to $60

Very interesting - well done RV. Nice overview of the sector, and like the investment thesis. I'm watching this in April of 2018 by the way, and already am in small size in UEC and NXE but wondering what else to do here. Is Cameco the 'best way to play it' as the big market leader (other than Kazatmoprom) or are there some other nice options out there that would benefit greatly from any big bounce in the uranium price? Most of the smaller explorer / producer space is in pretty risky domiciles other than Canada and Australia. Also, wondering what a stronger dollar does here in terms of supply, especially since I assume China would be getting most of it's supply from Kazakhstan and/or Russia. Would there potentially be a price differential in different regions of the globe a la WTI and Brent? I'd expect that even a strong USD won't hurt this commodity as much as others, and given the ramp up in China might not be an issue at all. @Brent B. Thanks for the Twitter link to quakes99 - good stuff.

60 $ a pound

it would be great if Adam can address the concerns from the article: "New technologies are becoming available that will reduce the need for uranium in the future, including re-enrichment of depleted uranium, and a next generation nuclear reactor."

Always good to question biases. This article is from January and states an oversupply number of 22m lbs of oversupply for 2018. Announced cuts seem to take care of that for 2018 and the market could be in deficit for 2018.

what does Uranium have to do with Oil & Gas?! It's like comparing apples with oranges.

I agree that those can be factors to pay attention (particularly for shorter periods of time) but the most powerful driver of price is going to be supply demand which is going to mostly driven by factors in the Nuclear/Uranium. space.

Also most traders in the energy space are not going to be trading uranium so probably aren't going to view it as part of their energy trading world.

To answer Amir G. (not that I know anything) Oil and Gas (particularly gas) has been an interim fuel source (gas being considered a "clean fuel") and (coupled with Fukushima) has delayed the impact of the low-low-price of uranium being a catalyst of future higher prices (as Rick Rule has said many times in the commodity space that the cure for low prices is "low prices"). I have to agree with henry g. that the price is going to be driven (in the near term) to much higher highs (maybe in the next two to three years) as a result of the market having been suppressed up until now (i.e., the cost of producing being much higher than the current commodity price).

http://live.gridwatch.ca/ for ontario but still cool

@Amir G. "what does Uranium have to do with Oil & Gas?" ... What does butter have to do with oil in cooking? What does flour have to do with baking powder in baking? What does potassium have to do with nitrogen in gardening? Ah yes ... the eternal questions of life ... I hope to know some day before I become NPK for some above-ground life forms.

Guess you missed my post below!

Guess you missed my post below!

Guess you missed my post below!

Thanks Douglas. Very informative.

Great info! Thanks

Fantastic input!

Comment better than he video. thanks

Totally agree, very useful information and I think the quicker RV can get some sort of forum the better for all subscribers. I know there’s a lot of smart people here who could help fill in some of the gaps. Could also hugely help with trade recommendations, which ultimately is why we are all here in first instance.

Very helpful. Thanks!

Very good points. It will be very interesting in the medium- to long- term to see how the arguments for increased fuel cycle efficiency / elimination of intermediate half life wastes play out versus the proliferation risks attendant to adopting current breeder technology (granted, if one of the PUREX replacements that doesn't offer facile extraction of plutonium gains traction, then maybe we overcome that battle). For now, geopolitical considerations seem to be retarding that debate. Over an even longer time horizon, it will be interesting to see whether the coming yellow cake price spike kindles renewed interest in the thorium fuel cycle...

Great info Douglas! What are your favorite companies in the space?

Spot on Douglas. Adam missed the decomissioning issue!

Thanks very much Douglas. It is generous of you to add your Insight

Eric, that sounds like a great suggestion.

Dave Iben of Kopernik has a very large (largest in his portfolio) position in Cameco, he is quintissential deep value guy with tradewinds llc and now Kopernik. That was before any of these cuts Kazatoprom 10% in 2017, then Areva in Niger, then Cameco with Mcarthur and now Kazatoprom with a further 20%. Fuel for the fire.

if Uranium spot is going parabolic at the same time that the broader equity market is going down... do you really think that Uranium producers will also, go down?

yes @marten R. just like gold miners in the last crash. Margin calls don't care about fundamentals

"As for Japan, think of it this way. The combined Cameco/Kazakhs cut for 2018 is ~27M lbs. That's enough to power 25 Japan reactors for ~2 years. It's like last week 25 reactors got restarted 2 years early on the demand side." https://twitter.com/quakes99

The Fukushima reactors were designed in the EARLY 1950's and were simply never very safe. So a replay of that level of accident is unlikely even with poor quality. Remember, the Chinese detonated their first A-bomb in 1964 and their first H-bomb in 1967, three years later. So they know what they're doing in nuclear physics. Besides, they can just buy our technology then replicate it, like eveything else. More importantly, right now they are killing millions with their smog. So even with a nuclear accident they're well ahead.

Your China comparisons to Fukushima and high-speed rail feel like apples and oranges to me. While it is certainly true that China is using the opportunity to develop its indigenous nuclear power engineering/construction industry, the plant build-outs I've been tracking are all either being built under the direct engineering oversight of a major player, e.g., Westinghouse, or--with some later projects--under partnerships and IP licensing agreements with a major builder. Indigenous designs are certainly coming, but they are seemingly taking a cautious, incremental approach. Fukushima's plants were Generation III BWRs. The reactors China is building are called Generator III+ PWR designs (specifically, most of the new fleet are based on the Westinghouse AP1000 design). In addition to the fundamental differences between BWRs and PWRs, these designs incorporate more passive safety features (based upon 20+ years of lessons learned from operating generation III plants), in favor of the active safety systems that Fukushima largely relied upon. To be fair, Fukushima did have passive cooling systems, e.g., high pressure injection pumps driven directly by steam turbines, however those systems were dependent on the safety-side DC electrical buses in the reactor building for control, valve operation, etc. Due to an atrocious site design, the battery rooms and emergency diesel generators were neither at reasonable elevation, nor water tightened the way NRC regs would require here in the US. Using Fukushima as an exemplar of bad technical design seems, at least to me, to misplace blame that should largely fall on regulators for abdicating their responsibility to oversee and question. That said, certainly, your concerns about tail risk should not be ignored. However, we have incorporated a great deal of learning into designs such as the AP1000. Furthermore, the Chinese Communist Party is well aware that social upheaval resulting from a meltdown would pose a dire risk to their hold on power. I suspect that realization, combined with evidence pointing to hybris being a contributory factor to Fukushima, will reduce that likelihood, at least in the medium term. To the other comment about Fukushima being designed in the early 1950's, that is a considerable exaggeration. Generation III designs were the product of the lessons learned in the early- to mid- 1960s with various small-scale, test, and research reactors. It is true that as part of a rush during the cold war, generation III designs did stem from early naval light-water reactor designs purely for expediency, despite better designs existing in the lab (e.g., high temperature gas coolants, molten salt coolants, etc.). To say the design used at Fukushima was never very safe also feels like a mischaracterization. A large chunk of the civilian nuclear deployment in the US uses the same underlying design as Fukushima. The differences were largely cultural: the NRC seems to suffer considerably less from regulatory capture than Japan's Nuclear Regulation Authority. The consequence has been better hardening and scrutiny of safety-critical systems at US plants.

Hi Thomas, Thanks for sharing your expertise. Great details.

Thanks for posting the link

Check out CEO.CA and go to the Uranium channel for further specific stock ideas

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When it looks like bitcoin. Get out :)

electricity**

An interesting line of thought: how far will uranium company stocks fall, if the general market falls 20-30% (or worse!)? Yes, they would fall; would they fall below long term bottoms? Thats about 20% fall for CCJ from ~US$10 ( todays price) to US$8 (5yr low). I imagine undervalued stocks like uranium companies would be some of the first to rebound. But what does this mean for position sizing? What does this mean for what percentage of a portfolio should be deployed to Uranium?

there's blood in the streets... equity prices have declined 70-90% the number of listed uranium companies in the US is down to about 40 (?) from over 500 (!) to summarise... those that have survived - are mostly the best. the current ridiculous prices of companies in the market (more than) compensates you for market risk this is a pennies on the dollar type situation. Besides - as I said above - if uranium spot is going vertical - uranium equities will not be impacted by a broader market selloff, or if they are, it will be (very) temporary. I'd be positioning now before the market prices in the inevitable

You only think he's 22 because of the ever-wider chasm between 22 and your current age. ;-) I reckon Adam is 38-42. Would that I were, once again, so young ...

I see from the '30 under 30' segment that Adam was in his 20's in 2015... so yeah, he's early in his career. I meant no disrespect to him by my comment... he's clearly switched on and, I sincetely hope, right on this call... noting that Rick Rule has been saying the same on Uranium for more than a year. Amusing the collection of downvote tears in response to my comment... it just goes to show that the world really is full of hyper-sensitive, humourless PC bores who take themselves far too seriously.

very good observation! indeed, that does raise the question.... perhaps too early yet as it happened too fast, but the demand for Uranium futures might soon move towards the upside given the recent back to back supply cuts by Cameco and Kazatomprom

Perhaps because fuel is such a small component of operating a power plant. Establishing a team and the expertise to engage in hedging may not be worth the expense.