Uranium is Having a Moment

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The fuel that powers the 440 active nuclear reactors across 32 countries today (~10% of the world's electricity and 25% of the world's low-carbon energy) has gone parabolic and is now up 120% over the last year.

As with all commodities (and most investments broadly speaking), price is determined as some function of: (Supply & Demand)^Speculation.

The supply-demand balance or imbalance makes up the ‘fundamentals’ of a commodity while speculation by investors and traders (a relatively recent phenomenon in the uranium markets, as we’ll see below), layers on the less predictable human element of price setting (bubbles and corrections can largely be attributed to this unpredictable variable).

In this piece we’ll parse out the fundamentals of the uranium market, its unique (and increasingly dangerous) supply characteristics, today's demand coupled with known and forecasted new demand coming online, what we believe the speculators are looking at that may be causing this outsized move, and whether this is a structural shift higher in prices or a temporary rolling bubble (which seems to be the norm in commodities these last few years).

Let’s dive in…

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