I’m deeply humbled by the messages & emails expressing gratitude. It’s been an emotional week between the personal stories shared with me and sending my kid off to college. I do my best to be stoic, but I’m really moved by it all. I appreciate all of you.

A few quick thoughts.. After a week like we just had, it’s natural to see the uranium chart going vertical and to think “this can’t last.”

It will last until new supply solves the deficit. It will happen, but it’s going to take time. So, what’s actually happening in the physical market?

A fundamental investment inherently requires faith. You can do deep due diligence on a sector and individual companies, find growth projections for both...but ultimately, you are betting on the market appreciating your findings, and there is no guarantee it will.

https://twitter.com/uraniuminsider/status/1663942924395225090

While there is plenty of historical precedent for market appreciation based on improving fundamentals – and especially related equities to a rising commodity price – it STILL is no guarantee that your position(s) will move "as they should," ESPECIALLY in the short term.

I should add some color to this...

A jump from .20 to .30 enrichment tails represents a 21.3% increase in uranium feed.

UF6 (Uranium hexafluoride) – or converted uranium – is the actual feedstock for enrichment. Paulo is correct that "overfeeding" requires abundant UF6...

https://twitter.com/PauloMacro/status/1613009339530334208

Overfeeding, by definition, is enrichers purchasing UF6 or U3O8 + conversion (both are happening now) in order to produce more enriched uranium (EUP), faster, by raising the operational tails higher than what was dictated in the enrichment contract.

This is the 5th time in 6 years I’ve seen this kind of sentiment lows, retail capitulation, and nasty rhetoric. Not my first rodeo. Won’t be my last. Very valuable sentiment signal for me.

In the past two weeks I’ve spoken with two fuel buyers, two hedge fund MPs w/ uranium… focus, 4 CEOs, and two legacy contacts of mine who have done 25x more work than almost anyone here.

That’s in addition to our own DD and modeling work.

My tweets — in addition to our Newsletters, webinars, podcasts, and interviews — are a reflection of my understanding of…

We'll likely see ~120m lbs. signed in LTCs for 2022. Maybe a bit more, maybe a bit less. This is the most annual lbs. in LTCs since 2012...and is happening while western utilities 'flex up' existing contract deliveries (executing option to receive sometimes up to 30% more... ...uranium than originally contracted). This is an obvious lever to pull during such a tumultuous year. Not only has the uranium market bifurcated (Russia/ex-Russia) which has lead to higher operational and transactional tails for western enrichers AND less (no?) western...

The more I think about all of the moving parts of the #uranium sector and the various factors affecting this investment, the more difficult it is to summarize into a concise tweet.

Hour-long interviews that feel like they could go for three and still not cover it all... In an attempt to put a finer point on what I see now and what is incoming for this trade, the primary fundamental development that is underpinning a complex set of variables is the rapid change in Western fuel cycle fundamentals and the resultant shift in utilities' behaviors...

Sentiment hasn’t been this low since March 2020. This is definitely lower than August 2021, which was pretty damn low. And as we’ve seen many times before, the buying/selling on the margin dictates price. The contrarians amongst us adding to positions doesn’t offset the risk… …being taken off the table AND the “nail in the coffin” indiscriminate selling by $URA rebalance.

So, you have to ask yourself:

▪️Where do I see this market going in the 2-3+ year timeframe?

▪️Is the #uranium bull market over at $44/lb.?

▪️Would an entity such as Sprott..

A number of folks concerned last week that SPUT purchased 1.2M lbs one day and the spot price moved “only” $.25/lb.

The way we view this is that SPUT is a ship motoring away from the pier with a rope still tied to the hull. The rope is of unknown length, coiled on the… …pier. At some point the coil will run out, the rope will pull taught, and the ship will drag the pier out to sea.

The ship’s fuel is financial capital. How fast and how far the ship runs will be determined by capital flows.

1) $KAP stating a possibility of further spot market purchases during H2 signals to me that their efforts to make up for lost time Sept-Nov 2020 (minimal WF dev Dec-Feb...winter) after the Mar-Aug 2020 shutdown of WF dev is unlikely to result in expected prod levels.

https://twitter.com/quakes99/status/1430876227691159555

2) My understanding is that wellfield development is what is primarily impacted with employee shortages (Covid), though this does not take into account potential supply chain problems.

If their WF dev slows now during the height of the season (NOT winter), the prod impacts...

One thing that is holding prices down now will also be what contributes to the price spiking later.

The more mid-term contracts that $KAP fills now @ ~$35/lb, the less material will be available to utilities coming into the market in the next 2-3 years.

Now with KAP doing... ...some spot purchasing alongside $CCJ in the coming months, one has to wonder: will a rising spot price lift this term price? Or will KAP reach a point where they are no longer willing to sell future production at this price?

Yes, these contracts are majority spot-referenced..