U308 Spot Price Hits a 16-Year High
Since the last update, late November 2023, my uranium portfolio P/L (%) has increased from +234.85% to +319.61%. The U308 spot price, floating around $80/lb. in November 2023, is now receiving bids of $105/lb.
What has changed since the last post? Two big changes:
The U.S. is backing this commitment as seen in a recent loan to restart a shuttered nuclear plant:
For those not following daily updates from John Quakes (@quakes99) on X (formerly known as Twitter) - I wanted to share two items he posted this week. First is an inflation adjusted U308 spot price chart (below, h/t @NuclearDorito). This chart helps to visualize just how much further the spot price can run.
John also caught my attention with a second post containing a link in which Porter Collins (Yes, “The Big Short” Porter Collins) mentions Uranium as his highest conviction trade for 2024. Link here (22:40 min mark for Uranium).
Thank you John and happy to see someone as sharp as Porter in this uranium thesis.
Pending Ban on Russian Uranium Imports (quote from Axios):
How it works: The Prohibiting Russian Uranium Imports Act would ban low-enriched uranium, used in conventional commercial reactors, that comes from Russia.
It includes a waiver for energy companies with no "viable" alternative to continue sourcing LEU from Russia through the end of 2027.
That doesn't give companies much time in the slow-moving nuclear world. For that reason, some lawmakers have emphasized that the legislation has to be one in a sequence of policies to find new enriched uranium sources.
Energy and Commerce ranking member Frank Pallone has said the bill must be paired with efforts to shore up domestic enrichment.
It passed the House by voice vote in December after the lawmakers agreed to include the Nuclear Fuel Security Act — which would create a new DOE program for domestic uranium — in the defense authorization.
In 2022, U.S. nuclear power plants received about 20%-25% of their enriched uranium from Russia. While this proposed ban does provide a short-term exception for utilities unable to find an alternative source of enriched pounds, the risk of Russia retaliating by restricting exports to the U.S. is very high. This could drive more panic in the hearts of U.S. utility fuel buyers.
If 2020 through 2023 were the years of gradually, I expect 2024 to be the year of suddenly.
Thanks for reading and remember to always swim with caution!
Disclaimer: EdgyFin is for educational purposes only and should not be considered investment advice. Please do your own due diligence and consult with a professional before you risk it for the biscuit!