Marco Bozem
Independent hard-asset investor specialising in mining, shipping and energy dividends. Uranium is on the watchlist as a cyclical hard-asset addition — the structural deficit thesis is tracked closely.
Uranium stocks — shares in companies that mine, enrich or hold physical uranium — have become one of the most discussed hard-asset investments since 2020. The investment thesis is straightforward: nuclear energy is experiencing a policy reversal in almost every major economy, AI data centres are creating enormous new electricity demand that only baseload power can reliably supply, and decade-long mine underinvestment has created a structural supply deficit. Uranium is one of the few commodities where the demand growth story and the supply constraint story are both simultaneously compelling.
The political momentum behind nuclear power has shifted dramatically since 2022. Germany's decision to shut its last reactors in April 2023 now looks like an outlier rather than a trend. Nearly every other major economy is moving in the opposite direction:
The cumulative effect: global nuclear capacity is expected to grow from approximately 375 GW in 2024 to 520–570 GW by 2035. Each gigawatt of nuclear capacity requires approximately 200–250 tonnes of uranium per year for fuel. The math points to a structural demand increase of 30–50 million lbs of U3O8 annually by the early 2030s.
This is the newest and fastest-moving driver of uranium demand. AI training and inference requires enormous, uninterrupted computing power. A single hyperscale AI campus (50,000+ GPU cluster) can draw 500–1,000 MW of electricity continuously. The critical constraint is that AI workloads require firm, always-on power — not solar or wind (which are intermittent) and not natural gas (which has price and supply variability). Nuclear is the only large-scale, carbon-free, baseload electricity source available.
Microsoft's deal with Constellation Energy to restart Three Mile Island Unit 1 (835 MW, 2028 target) is the clearest signal: Big Tech is willing to pay a premium for guaranteed nuclear power — and that directly underpins uranium demand for decades.
Uranium mine supply peaked in 2016 at approximately 162 million lbs of U3O8 and fell sharply following the Fukushima effect. By 2020, global production had fallen to approximately 120 million lbs against demand of approximately 180 million lbs — a gap filled by drawing down above-ground stockpiles accumulated during the oversupply period of 2007–2015.
Those stockpiles are largely depleted. New mine development has been severely limited: only Cameco's Cigar Lake, Orano's Somair/COMINAK complex, and Kazatomprom's Kazakh operations (the world's largest supplier, approximately 43% of global supply) are at scale. But Kazatomprom has cut guidance for 2025–2026 due to sulphuric acid shortages affecting in-situ recovery operations — reducing expected Kazakh supply by 15–20 million lbs/year.
| Supply Source | 2024 Est. (Mlbs U3O8) | 2026 Outlook |
|---|---|---|
| Kazakhstan (Kazatomprom) | ~75 | ~60–65 (acid shortage) |
| Canada (Cameco, Orano) | ~22 | ~28–30 (JEB mine restart) |
| Namibia (Rossing, Husab) | ~14 | ~16–18 |
| Australia (ERA, Heathgate) | ~7 | ~6 (ERA declining) |
| Other (Uzbekistan, Niger, Russia) | ~25 | ~20–22 (Niger coup impact) |
| Total Supply | ~143 | ~130–138 |
| Total Demand | ~180 | ~185–195 |
| Deficit | ~37 | ~50–60 |
Unlike most commodities, uranium is primarily sold through long-term contracts (3–10 year durations) between utilities and producers. The spot market (traded through intermediaries like Ux Consulting or TradeTech) represents only 10–15% of total volume but sets the price signal that markets focus on.
The uranium spot price (U3O8, $/lb) hit a multi-decade high of approximately $106/lb in early 2024, corrected to approximately $65–75/lb in late 2024–2025, and has been recovering through 2026. For context, the all-time high was $136/lb in June 2007. Most new mine projects require $65–80/lb to be economically viable — current prices provide marginal incentive for new supply, but not enough to rapidly close the growing deficit.
There are three main routes to uranium exposure, each with different risk/return profiles:
The cleanest uranium exposure. The Sprott Physical Uranium Trust (SPUT, TSX: U.U / OTC: SRUUF) holds physical uranium in licensed storage facilities. Its net asset value tracks the U3O8 spot price almost exactly. When SPUT trades at a premium to NAV, it issues new units and buys more uranium — directly removing supply from the market and reinforcing the price. No dividend, no operational risk, pure commodity exposure.
| Company | Ticker | Key Assets | Dividend? |
|---|---|---|---|
| Cameco | CCO (TSX) / CCJ (NYSE) | Cigar Lake (world-class), McArthur River, JEB restart | Small (~0.5–1%) |
| Kazatomprom | KAP (London GDR) | Multiple Kazakh ISR mines, ~43% global supply | ~6–8% (variable) |
| NexGen Energy | NXE (NYSE) | Rook 1 (Arrow deposit, world-class, pre-production) | None |
| Denison Mines | DNN (NYSE) | Wheeler River (ISR feasibility), Athabasca Basin | None |
| Uranium Energy | UEC (NYSE) | US ISR operations (Wyoming, Texas), Roughrider deposit | None |
| Paladin Energy | PDN (ASX) | Langer Heinrich (Namibia, restarted 2024) | Small |
For diversified exposure, the main options are: Global X Uranium ETF (URA, NYSE Arca) — holds Cameco (~22%), NexGen, Kazatomprom ADR and other miners. Sprott Uranium Miners ETF (URNM) — more concentrated in pure-play producers. Both provide uranium sector exposure without stock-picking risk, but at higher cost (0.5–0.8% management fees vs. physical trust).
Uranium investing carries specific risks that differ from other commodity sectors:
Uranium fits into a hard-asset portfolio as a high-conviction, high-volatility position — not as a core income holding. The investment case is structural (decade-long supply deficit, policy reversal, AI demand) but the near-term returns are driven by speculative demand from financial buyers. This distinguishes uranium from shipping or mining royalties, which pay dividends from actual cash flows regardless of price direction.
Marco's take: Uranium is in the portfolio watchlist, not as a core income position but as a potential cyclical addition when valuations compress. The structural thesis is solid. The execution risk (mine development delays, Kazakhstan logistics, price volatility) means position sizes should be 2–5% maximum for a dividend-focused hard-asset portfolio. SPUT (physical trust) is cleaner than individual miners if you want pure commodity exposure without operational risk.
Independent hard-asset investor specialising in mining, shipping and energy dividends. Uranium is on the watchlist as a cyclical hard-asset addition — the structural deficit thesis is tracked closely.
This glossary article is for informational purposes only. It does not constitute investment advice or a recommendation to buy or sell any security. Uranium investments involve significant volatility and risk. Always conduct your own research and consult a qualified financial advisor before making investment decisions. MB Capital Strategies may hold positions in related securities.