0:00

I would say what isn't discussed enough is

0:02

how safely and how well waste is stored

0:04

and how, how less of an issue

0:06

it is than most people believe. I think

0:08

that that's any time I

0:11

even speak with somebody who's pro-nuclear,

0:13

that's like just everyday, you know, conversation

0:16

at a dinner party or something. And they asked me what

0:18

I do. We talked talking about nuclear energy. Like,

0:20

oh, I'm so behind it that it's just, man. What

0:22

about the waste? And then I tell them that all

0:24

of the ways that were produced in the United States, since

0:27

the fifties can be stored on a single

0:29

football field, 30 feet high, and they go really.

0:42

Justin, thank you so much for coming on

0:44

to age of information. You

0:46

know, uranium is this thing that some people may

0:48

or may not have heard of, if you did hear about it you

0:50

probably heard about it through TV shows or the

0:52

general news. I've realized in the last year that

0:55

it's very sophisticated and there's a lot going on.

0:57

And I think a great place to start this conversation is to

0:59

just ask you, how

1:01

did you get into this space? What attracted you

1:03

and what makes it as interesting

1:05

as it is right? Sure. Yeah. Thanks

1:08

so much for having me. Well, what first attracted me honestly,

1:10

is the investing potential in

1:12

the sector. You know, that that was 2016.

1:15

So about five years ago, when the

1:17

thesis first came to me, I primarily

1:20

had been a momentum technical

1:22

trader for the previous, you know,

1:24

five plus. And this thesis came to me about the sector

1:26

that had a commodity, that

1:28

it was, you know, based upon trading

1:31

at, you know, a third or a quarter of the,

1:33

of the price that it should be trading at for the marginal

1:36

cost of production. And it is this hated sector.

1:38

It's been in a long bear market. And, but

1:40

yet it was a growth sector. The,

1:43

the, the outlook for nuclear energy

1:45

out of the future is very positive. Was and is,

1:48

and you know, it was only a matter of time

1:50

before the demand for uranium

1:52

as the, as the fuel for nuclear energy, kind

1:54

of turn that investment around. And so

1:57

that's what got me interested. Obviously, the previous

1:59

bull market for uranium from an investment

2:01

side of things was very very

2:03

lucrative for investors to say the least

2:06

from about the 2003, 2004

2:08

to around 2007. There

2:10

was just a bull market of epic proportions. So

2:13

you know, investors always want lightning to strike twice

2:15

and it usually never does and the exact way, but that's

2:17

what got me into. The more research I did, the more I realized

2:19

I was really fascinated with the sector and,

2:21

you know, come, you know, jump to today

2:24

and I'm a full-blown advocate for

2:26

nuclear energy and, and has

2:28

amazing benefits for the world that we live

2:30

in. And so it's, it's a wonderful investment

2:32

from that standpoint, because that's something that has

2:35

already and will continue likely to

2:37

offer significant returns to patient

2:39

investors while at the same time. It's

2:41

something that I can feel good about investing

2:44

in and knowing that I believe

2:46

that it's part of a solution for, you

2:48

know, clean energy for, for the developed world

2:50

going forward. How confidently

2:52

can we say that lightening is about a strike or

2:54

is it striking twice right now? It's I can say

2:56

pretty confident. So the

2:58

previous bull market went from just such a,

3:01

such an extreme, low to

3:03

an extreme high in such a short period of time.

3:06

And I don't believe that this time around,

3:08

it's going to repeat that timescale.

3:11

So, you know, we bought them out this, in

3:13

this cycle about $18 a pound

3:15

for uranium in 2016. And

3:18

we're up at about $46 a pound now,

3:20

and the equities have done extremely well

3:22

since that point. You know, the worst performers

3:24

are up about 250. And

3:27

the best performers are up about 5,000

3:30

to 10000% since 2016

3:32

already. But the potential

3:35

for the price for uranium to

3:37

go much, much higher is definitely there. It's

3:39

practically guaranteed to go another 50%

3:41

higher because there's a supply

3:44

deficit based on the expected

3:46

demand, going out into the later part

3:48

of this decade, where. Marginal

3:50

cost of production is going to have to come into play to

3:52

fill that deficit. So you have uranium

3:55

mines, like the lowest cost producers right now in

3:57

Kazakhstan they're producing

3:59

for, you know, in some of their minds are less than

4:01

$10, a pound cash costs, but fully

4:04

allocated when you consider the dividend they pay

4:06

and, and interest rates and

4:08

supply chain issues. And all of that they're producing at about

4:11

35 bucks a pound. That's the cheapest in the world.

4:13

Then you have projects. You know, Bannerman's

4:16

tango project in Namibia that has a

4:18

few hundred million pounds of uranium. That's ready to

4:20

be developed, but they need, you know, $80

4:22

a pound. Right. And so

4:24

at $46 a pound, and you can pretty much guarantee

4:27

that we're going to go into that 65, 70 $5

4:30

range, but the likelihood

4:32

that it's going to overshoot is extremely high.

4:34

For reasons we can talk about further

4:36

if you'd like, but basically there's there's financial

4:39

players and hedge fund interest and

4:41

things like that that are actually physically purchasing

4:43

physical uranium and affecting

4:46

the market in that way as well. So,

4:48

yeah, I think, you know, my understanding is that the supply

4:51

side of it has a lot of players and

4:53

it is a very important piece in how we sort of

4:55

forecast the pricing of uranium. Like you said Kazakhstan,

4:58

it needs it at least at $85. But how

5:00

transparent is the amount of supply

5:03

that's available and will be produced? I've

5:05

heard some reports that whether it's China

5:07

or some other sort of foreign entities, they

5:10

could have more supply than what we previously

5:13

considered is that a possibility it's not very

5:15

transparent at all for the most part. I

5:17

mean, you really have to do a lot of research and

5:20

you can, you can gain some insight through

5:22

some like higher price subscription

5:25

memberships that like the utilities, for example, pay

5:27

for with the like UFC and trade tech.

5:29

These are the consultants, nuclear fuel

5:31

consultants. They have a pretty good grasp on what's going

5:33

on out there in the nuclear fuel markets.

5:35

Of course speaking with utilities, speaking with traders,

5:38

you can kind of get a better idea. You can

5:40

make very rough estimates based on the

5:43

estimated over-supply

5:46

from the previous day. You know, subtracting

5:48

what China likely took out of that. And that's

5:50

what you have left over in the

5:53

global mobile inventory category.

5:55

Let's say from the mid 20

5:57

teens until now that number

5:59

roughly let's say was 150 to 200

6:02

million pounds of excess supply that

6:04

didn't go to China that was available

6:06

for sale or for trade over

6:08

the past number of years. When

6:10

you consider chemicals shutting

6:12

down McArthur river in 2018, combined

6:14

with their purchasing, they themselves have

6:17

had a hundred million pound influence

6:19

into that deficit. We've had

6:21

something called a carry trade that has been

6:24

prevalent in the uranium market for the past few years.

6:27

Is traders essentially are

6:29

signing contracts with utilities to provide

6:31

uranium 2, 3, 4 years out. And

6:34

they are covering the cost of capital.

6:36

They're taking on a bit of risk for holding that on their books

6:39

and they're going out and purchasing that some

6:41

of that mobile inventory and making it. Easily

6:44

accessible to utilities. This was a

6:46

boon for utilities over the past five plus

6:48

years. Of course it hurt the producers.

6:51

You have the chemicals of the world that are sitting

6:53

on this massive mind, the largest in the world, McArthur

6:55

river, and saying we need 45 to

6:57

$55 a pound. We need those insecure

7:00

long-term contracts or this mine's not coming back on.

7:03

Yeah, the utilities continue to go back to the

7:06

carry traders for this cheap pounds

7:08

for 2, 3, 4 year delivery as

7:10

they should. So that is all sort

7:12

of coming to an end now

7:15

and we're having this very slow turn

7:18

from a oversupplied buyers

7:20

market to an under-supplied sellers. And

7:24

it's yeah, it's quite opaque. It's

7:26

difficult to really drill down. You know,

7:28

it's easier to understand the primary production.

7:31

That's a number that you can kind of wrap your head around.

7:33

As far as Chinese supplies go.

7:36

They don't have a lot of domestic supply

7:38

as far as mined uranium. It's

7:40

not a lot. It's probably, you know,

7:42

less than 10 million pounds a year that they're pulling

7:45

out of China and that stays in. They

7:47

have hundreds of millions of pounds of inventory,

7:50

but that's essentially strategic national

7:53

inventory, especially considering their build-out

7:55

plans, which are significant.

7:57

They're shooting for 200 gigawatts of

7:59

nuclear by 2035. And they currently have

8:01

50. So 150

8:04

gigawatts is about 150 new

8:06

reactors that needed to be built in the next

8:08

15 years. They have 18 under construction

8:10

right now. So they're going to go gangbusters on

8:12

nuclear. So the likelihood that their strategic

8:14

inventory is going to be sold in the market is

8:17

pretty. Right. And it

8:19

seems like one of the biggest I guess price makers

8:21

is the spot trust. So if you could quickly

8:23

describe, what is that trust? I think my understanding is that,

8:25

you know, had a lot of influence when it first launched, but

8:27

that influence that has maybe sort of degraded

8:30

over time. And I don't know how much influence it's still

8:32

holds on the market. You know, we're talking in November.

8:34

So if you could speak to that, Sure.

8:36

Yeah. Their influence is still substantial

8:39

and likely going to only grow. And that

8:41

has to do with the consistently increasing

8:43

liquidity of that. It's going

8:45

to draw more and more investment interest, especially

8:48

if they get a New York stock exchange listing next year, which

8:50

I believe they will they'll have some opposition

8:52

most likely from the utilities in the states. Why

8:55

would the utilities oppose a New York stock

8:57

exchange listing for spot? Well,

8:59

I don't know that they necessarily. They're

9:02

there. So, first of all, when the sec,

9:04

when you file the application for the New York

9:06

stock exchange listing with the sec, there's a,

9:08

like a three-week comment period, public comment

9:10

period. And you

9:12

know, the utilities, us nuclear utilities

9:15

have a lot of lobbying power of the government.

9:17

And so they're likely to push back against

9:20

it because they're going to recognize that this

9:22

listing is going to allow. Orders

9:25

of magnitude more liquidity to come into this

9:27

vehicle, which directly equals

9:30

purchasing a physical pounds of uranium, which is driving

9:32

up the spot price. Even though you utilities,

9:34

at least right now are largely out of the spot market.

9:37

It still affects the term market. They, they have

9:39

term contracts still that are rolling

9:42

off or have expected deliveries out into

9:44

the future that are at least partially referenced to the

9:46

spot price of uranium. So if they

9:48

sign the term, contract that $40

9:50

a pound. 40% and 60% spot

9:52

reference probably with a ceiling, but either way

9:54

at the time of delivery, they have to pay whatever the spot price

9:56

is for that, for that delivering uranium.

9:59

And they obviously don't want to pay

10:01

any more than they have. So there,

10:03

they're going to have something to say about it. I don't

10:05

know that they can stop it. But we'll

10:07

see. I'm, you know, it's not something we're even betting

10:09

on because we've already seen what they've been able to do on

10:11

the TSX alone. Just the New York stock exchange

10:13

is what 13 times the size

10:16

in terms of capital. So,

10:18

but to backtrack briefly, The

10:21

spot is the Sprott physical uranium trust

10:23

they brought, had been working on this

10:25

deal of taking over uranium participation corporation

10:28

for almost three years. Uranium

10:30

participation corporation was founded

10:32

in 2005. It's a physical

10:34

trust or physical. Where they were when they were trading

10:37

at a significant premium to their net asset value.

10:39

So the value of the stock because of buying pressure

10:42

grew faster than the underlying price of uranium,

10:44

that premium would allow them to issue shares

10:47

into the open market, raise cash by

10:49

more physical uranium. They accumulated

10:51

18 million pounds. In those

10:53

16 years. And

10:56

the deal was announced in April. It was sealed

10:58

in July and immediately

11:00

Sprott did a couple of really intelligent things. The

11:03

first thing they did was to do a reverse split. I

11:05

think they did a three to one. It was a two to one or a three

11:07

to one. I forget it doesn't really matter. It had to get

11:09

them to this price where there's a number

11:12

of institutions that, you know, written in their

11:14

perspectives. You know, they cannot invest

11:16

in the stock. That's under X price. So

11:18

you just get it, do a reverse split, bump up the.

11:21

Automatically that opens you up to new investment capital.

11:23

So they did that. Step one, step

11:26

two is they filed for an at the market. Equity financing

11:28

vehicle, which essentially is

11:30

it's a vehicle that allows them to issue

11:32

shares into the open market at will.

11:35

And they are doing this whenever

11:37

they are at greater than a 1% premium

11:39

to nav. So UPC,

11:42

for example, they could go weeks and weeks

11:44

at a 10, 15% premium to nav.

11:47

And it was kind of to their own discretion, whether

11:49

or not they were going to issue shares. It was a very inefficient

11:51

vehicle. Now Sprott

11:54

is doing this. And any time there are greater than 1%

11:56

premium because they get a 1% fee

11:58

when they buy uranium. So if they're trading up

12:00

and there's good volume coming into the market, and they're out

12:03

of more than web Supreme to now, they're issuing shares

12:05

into the market. They're raising cash. They raised

12:07

$90 million in a single day, a

12:09

few weeks ago. And

12:12

that launched in the middle of the middle of August

12:14

of this year, since then, they've raised

12:16

almost a billion dollars through this ATM

12:19

and they purchased almost 22 million pounds a year

12:21

of uranium. So I

12:23

don't think anybody including Sprott knew

12:26

that when that first launched that

12:28

they would have that kind of impact that the, that

12:30

the spot price would move 50%

12:33

on only 10 million pounds of uranium. But

12:35

it did. And so now.

12:40

Now what's happening. This is kind of a complex

12:42

thing to explain. I would, I would definitely

12:44

suggest to you and to your readers or

12:46

your listeners to check out

12:48

Segra capital. They have

12:50

a a commentary tab on their website

12:53

where it's essentially a blog and one

12:55

of the capital partners. His name is art. Very

12:58

very sharp individual has done a lot

13:00

of work in the sector, wrote a recent piece on this, where

13:02

he's describing something called a reverse

13:05

carry trade. And so the carry trade

13:07

I just described what's happening

13:09

at least slightly right now. I'm going

13:11

through this with you because it sort of explains why

13:14

suppose Sprott just purchased 500,000

13:17

pounds in the price. Didn't move. Well, this is why they're

13:19

also buying off. They're

13:21

buying and what is called a block trade in exchange

13:23

for shares. So what

13:26

they're doing is The

13:28

Kerry traders who have let's say

13:30

taken, taken on a contract where

13:32

they're going to deliver out three years into

13:34

the future, for example, and

13:37

the current spot price at the time,

13:39

let's say it was 25. And they

13:41

have an obligation to deliver a

13:43

million pounds of uranium to the utility in 2023,

13:45

at $30. Okay. And so

13:47

they go out and they buy that million pounds at 25

13:49

bucks in the spot market. They hold it,

13:51

they carry it, it's on their books. And

13:54

they carry it. Now what's happening at

13:56

least did happen for a few

13:58

brief moments. There was, we have, what's called

14:00

backwardation in the market where you had the

14:02

present price of the commodity is higher

14:04

than the future price of the. It's

14:07

happened sometimes in commodities markets. So

14:10

what traders were able to do is they

14:12

were able to secure delivery

14:14

of pounds out at the same time

14:16

that they are they're obligated to deliver

14:18

in their, in their carry trade contract. From a producer

14:21

that's currently pending. At

14:23

a lower price than the current spot price.

14:25

So then they take the pounds, the carry and they sell it

14:27

to Sprott and arbitrage.

14:31

Exactly. So they're making a few bucks

14:33

a pound on top of the profits. They would've made on

14:35

their original carry. So that's happening a little

14:37

bit. And that's, that's the

14:40

interesting thing about that. And that's something that art Hyde points

14:42

out in this piece. Is that that's

14:44

taking pounds from the future. And so even

14:46

though it's pounds going into the Sprott

14:49

vehicle without immediately moving the spot

14:51

price, that's not the way to look

14:53

at it. The way to look at it is those pounds out.

14:55

At the point of delivery for that original carry trade

14:57

contract, they are now buying

14:59

from a producer and those pounds would have been

15:01

available to a utility. And now they're not. So.

15:05

It's brought, you know, every pound that they buy

15:07

is a net positive for the uranium thesis,

15:10

but the investment thesis, of course,

15:12

it's brought a whole new element

15:14

for the nuclear fuel market to deal with.

15:16

And annualized, the amount they've been purchasing

15:18

is, is just insane. You

15:21

know, you're looking at 75, 80 million pounds

15:23

of uranium in the 12 month period. If they keep at this pace,

15:25

I don't think that's going to happen. I think the price will continue

15:27

to rise. They can buy less from the price is

15:29

higher, but still even 50 million

15:31

pounds. That's the entire us nuclear fleet. So

15:34

it's been a huge game changer in

15:36

terms of. It accelerates to the

15:38

thesis. Sure. I'll link the

15:40

art, hide a piece actually did read that excellent

15:43

and very well written you know, earlier you said

15:45

that hedge fund hedge fund people

15:47

and other finance people have been buying physical uranium.

15:50

Does that mean they are buying spot

15:52

or are they buying over-the-counter directly from the

15:54

miners? What, what does that mean? Both, I would

15:56

say directly for the minors is probably

15:58

less because there's, you know, there is some mobile

16:00

inventory sitting in the can at the conversion facilities

16:03

and when you buy uranium and you're not an

16:05

end user, you essentially just change

16:07

hands on paper. And it just sits with that conversion

16:09

facility and changes ownership. So

16:11

there've been hedge funds that have accumulated some uranium

16:13

over the past few years. I don't think it's huge volumes,

16:16

but another thing that's happening currently is some of

16:18

that volume. Some of these

16:20

funds are selling those. To

16:23

Sprott in exchange for trust units

16:26

so that they don't have to carry a physical uranium on

16:28

their books. Now they carry these highly liquid shares

16:30

and they have the exact same exposure to the

16:32

upside of the commodity. So more

16:35

than likely going forward funds

16:37

that would have been purchasing physical uranium are likely to purchase

16:39

shares of spot, but

16:42

that also leads to physical purchases

16:44

since you buy shares in that trust in assuming

16:46

that, you know, you're at a premium to nav and they're issuing.

16:49

Sure. Sure. You know, another sort of

16:51

important piece that I think is like a top of mind

16:53

for a lot of people in uranium is

16:55

the ongoing narrative around CRDN

16:57

the Clearwater river Dene

17:00

nation. I'm not sure if I pronounced that. Right. Could you, could you

17:02

give me your take on that and sort of explain what

17:04

that is and how valid that narrative is

17:06

to the overall context of. Sure.

17:09

It's, it's valid in that, you

17:11

know, the, the lands that uranium

17:13

is being produced from currently, and

17:15

some of these development projects, exploration projects

17:18

in Northern Saskatchewan does

17:20

technically belong to a number of

17:22

different first nations tribes that are, that

17:24

have been there forever or for

17:27

a very long time, let's say. The

17:29

CRDN issue in particular their land

17:31

is where NexGen's arrow deposit

17:33

is visions. Efficiency deposit

17:35

is the PLS deposit. There's a bunch of explorers

17:38

in that area. So if that Southwest part of

17:40

the base and the Patterson lake area, where, where

17:42

there is of their primary concern and

17:44

I think. I gotta

17:46

be careful what I say here, because I don't want to implicate

17:48

anyone that the, they, they

17:51

want the mines to be built. It's a creative

17:53

for them. They have they have multiple

17:55

benefit agreements in place with

17:57

multiple countries. And they're

18:00

fully aware of what's happening

18:02

currently in the uranium market and, and

18:04

they want to be compensated

18:07

for the use of their lands as

18:09

they should. And so what's happening

18:11

currently is I mean, in particular with

18:13

next gen. So they've been in discussions

18:16

for two years now about coming

18:18

to an agreement about the development of the. They

18:21

absolutely want it to happen because it

18:23

employs a lot of their people. It would be a

18:25

huge financial benefit to the community.

18:27

And it would that particular mind as well, that's an underground

18:30

mine. It doesn't deal with a lot of the stuff that

18:32

the law of the mines on the Eastern basin

18:34

deal with, which is major groundwater

18:36

issues. This is mostly there's

18:38

very little surface sand stone before they get to the basement

18:41

hosted rock. And so. Simple mind

18:43

you geologically speaking, it's deep, but it's

18:45

simple. It's not going to be a major environmental

18:47

impact. So they want it to happen.

18:50

They're pro mining and that's the most important thing that

18:52

the investment community needs to know. Now,

18:54

can they throw some sand in the gears and are they

18:56

waving their hands now saying, Hey, you guys

18:58

want to move forward with this stuff. We know this bull market is

19:00

on. We know what's going on. We're not stupid. We're

19:02

going to need to get something that benefits.

19:05

From our lands that you want to mind on

19:08

as they should. So they'll come to

19:10

an agreement. They want it to happen. They don't want to stop

19:12

these projects from happening. They just want to be respected

19:15

and they want to be competent. So

19:17

the notice is almost like an interesting

19:19

leverage in negotiation with these companies

19:22

it's written by lawyers. Yeah. The study that

19:25

was cited in that notice was actually commissioned

19:27

and paid for by next gen. So

19:29

yeah. Got it. Got it. You know,

19:31

another topic on the supply side is

19:34

the us. Infrastructure bill just passed.

19:36

There was some provision for uranium specifically.

19:39

I think the reaction that I've seen is some positive.

19:41

Some, some feel that it's validation

19:43

on their thesis for the U S others

19:45

feel, you know, not so much, a little more pessimistic

19:47

about it. Where do you stand on that? W what's your take on the,

19:49

on the provisions of the infrastructure bill? Well,

19:53

I think that the most important piece of it in

19:55

terms of nuclear in the United States has

19:57

to do with support of the existing reactors. I

19:59

think expecting an all-out a

20:01

Renaissance of nuclear builds in the states is not

20:04

something that's really on the table. And I

20:06

think that while we had discussions

20:08

of supportive measures for domestically

20:10

mined uranium in the past, I think that's still

20:12

on the table. It's just at this point.

20:14

So many other things have happened for the investment

20:17

thesis. It's not even something

20:19

that, that people are even paying attention to anymore.

20:21

Cause it was they're proposing buying, you know,

20:23

one to 2 million pounds a year from domestic production

20:25

which is currently next to nothing in the states.

20:28

That'll change when the prices rise and some of

20:30

these developers can, can get into some

20:32

contracts with with us utilities and,

20:34

and utilities abroad. But

20:37

most importantly, is that the reactors,

20:39

especially in the deregulated markets where these reactors

20:42

have to compete with natural gas

20:44

power and, and that type of energy

20:46

that can often be produced cheaper, that

20:49

they have some kind of, you know, financial support

20:51

from the government. That's saying, okay, it's important. We keep these

20:53

online. And the government kind of has to do

20:55

it because, you know, if they're waving their arms

20:57

about climate change, but they don't want to support the reactors

21:00

that are by far the biggest

21:03

contributor to clean it up. It kind of doesn't add

21:05

up. And I think that people can start to see

21:07

through that at some point. So it's, I think

21:09

there was 6 billion in the infrastructure

21:11

built to support existing plants and two and a half

21:13

billion for research into advanced

21:15

reactors and small modular reactors, things like that.

21:17

So, you know, it's, you know,

21:20

in the grand scheme of things at the drop in the bucket,

21:22

but at something, so it's nice to see that there's

21:24

at least members of the department

21:26

of energy and members of the Senate of

21:28

Congress that are saying, we got to keep these. And

21:31

then he pushed for that, for that budget

21:33

inclusion. So that's good. I think

21:35

something interesting that you said earlier is

21:38

when the spot first launched,

21:40

they were surprised and everybody was generally surprised by

21:42

the amount of interest and demand. There was,

21:44

you know, the open market in retail and by

21:46

the institutions, et cetera. And I think Twitter plays

21:49

a role in that. And I think social media plays a role in that.

21:51

And when I first entered the space, I was reading some

21:53

theses by many different people. And

21:56

it would always start off with the fundamentals, like you were saying, like the supply

21:58

demand, et cetera, but then it would always end by

22:00

saying, well, there's always a potential for

22:02

wall street bets to jump in there. Or there's a potential

22:04

of a very particular subsection

22:07

of Twitter for them to jump in there and

22:09

they're going to take it from whatever

22:11

highs we've already seen to even crazier highs.

22:13

And that's going to be part of the squeeze. How important

22:16

do you think that aspect of the thesis is

22:18

actually like material to the price of

22:20

Spotify? Affect the spot price.

22:23

I would say as far as the kind of wall street vet

22:25

slash Uranian squeeze kind of thing,

22:27

not at all, that's not at all important.

22:29

It's not something that we would ever

22:32

suggest gambling on or expecting

22:34

to pan out. But that potential for

22:36

it is. In a similar vein.

22:38

I think that social media and the speed

22:40

of communication is hugely important. And

22:43

so in order for them, I mean really

22:45

how that crowd works best is, is

22:47

through squeezing short squeezing. So,

22:49

and they did that a bit with Dennis and mine's

22:51

earlier this year, actually in February,

22:54

they squeezed Dennis and went up, I think

22:56

a hundred percent in just a few days, the

22:58

closest. So it

23:00

it's always possible. It's usually a younger

23:03

crowd. Most of the time they're typically

23:05

trading on apps like Robin hood and

23:07

things like that, that only at this point have access

23:09

to the NYC and the NASDAQ.

23:12

So for them to go after the Sprott

23:14

physical uranium trust, I technically

23:16

they can corner on the OTC mark. But

23:19

you know, it's, it helps it

23:21

can help, but it's not important at

23:23

all for the overall thesis. But

23:25

with all of that said in a comparison with the previous

23:27

book, The speed

23:29

of communication is so drastically

23:32

different than it was even in 2006,

23:34

2007, with the advent of smartphones, just,

23:37

you know, just after that market. And then just the,

23:39

the amount of money that's circulating now compared

23:41

to then is, is way, way more

23:43

as well. So there's so much more money flowing. And

23:46

there is so much faster communication and

23:49

many more people investing in speculating.

23:51

So the appetite for for

23:53

volatile investments has grown,

23:55

let's say. Right. Right. And

23:57

actually the other super interesting thing about uranium

24:00

Twitter specifically is when I first

24:02

got into the space everybody was sort of aligned in

24:05

their mission and what, what they focused on, but

24:07

over time with more and more players

24:10

coming in. It has sort of fractured,

24:12

like there are different groups that believe in different things.

24:14

And now I'm seeing a little bit more, I want to say conflict,

24:16

but at least disagreement on different theses

24:19

and different tickers. And I wonder

24:21

is that ultimately bullish

24:23

for uranium because you know, you have, you have so many differentiated

24:26

opinions that everybody, you know, it's like iron makes

24:28

iron Trumper like steel MC steel sharper. Is

24:30

it, is that, is that how we should be looking at it? Or

24:33

is it bad that, you know, some people might be going

24:35

towards more dogmatic views when it comes to. No,

24:39

I don't think it's bad. I mean, I think

24:41

that people could be more civil generally

24:43

speaking. I mean, the, the uranium Twitter

24:45

community, for the most part, since I've been on, has

24:47

been extremely civil and helpful.

24:50

I've met unbelievably intelligent people

24:52

that have taught me a lot of I've had

24:54

some incredible conversations and connection

24:56

through Twitter. So it's still an unbillable. Beneficial

24:59

place to be when it comes to investing in communities,

25:02

especially for uranium. Yeah, I think that there's always

25:04

going to be viewpoints that are opposing

25:06

and I think it's good for those to be hashed out.

25:09

I'm not part of that is what kind of spurred

25:11

this piece that was written by, by Mr.

25:13

Hyde. So it's like it's it's so

25:16

it's good to see it makes a market right.

25:18

To have opposing views. And ultimately

25:20

when it comes down to. I think that the social media

25:23

communities on Twitter or Reddit or whatever, they have an impact,

25:26

but you know, when it comes down to it, it's going

25:28

to be the really big institutions

25:31

that have so much more power to move

25:33

markets. You know, you can have 50,000

25:36

people on uranium, Twitter, and you can have just

25:38

a couple of institutions come in, heavy handed,

25:40

buy, buy into the ETFs and buy

25:42

into the Sprott physically Rainium trust with a couple of hundred

25:44

million pounds. And the liquidity is there or

25:46

a dollar. All of a sudden

25:49

you get a massive move in the, in the sector.

25:51

So it affects things. I

25:53

think that discourse is healthy and

25:55

it's important to try to poke holes in each

25:57

other's discourses and, and see

25:59

where we might be wrong, where we might be. Right.

26:01

There's always something to be learned from somebody else. So

26:04

it's, it's nice to see. Sure.

26:07

So going back to the demand side of things, I

26:09

think there is a lot of differentiated opinion on

26:11

how much demand there really is. And I think you pointed

26:13

out some fundamentals, but what piece

26:15

on the demand side are people missing that

26:17

you feel is maybe not more widely

26:20

talked about or widely realized? I

26:23

think the piece of demand side that people are missing

26:25

is difficult to quantify

26:27

and estimate, and that would be a restocking

26:30

of. So it's,

26:33

it's goes against what, what

26:35

makes sense for most people to consider, which

26:38

is uranium, you buy a lot of utilities

26:40

load up on uranium when the price is low and

26:42

they, and they, they let it go and

26:44

the price is high and it's not really something utilities

26:46

really trade. So I think that

26:48

a restocking of inventory, even though the inventory

26:50

is. Roughly,

26:53

you know, around the average where they are generally

26:55

speaking, right? The us has right around two

26:57

years, maybe a little bit under two years of

27:00

inventory, average per, per utility

27:02

or per reactor. The the EU

27:04

utilities usually have to keep at least three years,

27:07

but when things start to get scarce

27:10

is when the restocking really happens.

27:12

And I think that that's. That's something

27:14

that's difficult to bake into any sort

27:16

of supply and demand model, but it's something

27:18

that can be expected if, and

27:20

when we see a point where the

27:22

utilities actually are concerned about keeping

27:25

their reactor up and running, if they're uncovered

27:27

out into the future, they pay what they need to pay to

27:30

make sure their inventory are both. And

27:32

another demand piece, I think is really interesting

27:34

that is kind of newer news that I think most

27:36

people are not necessarily giving enough weight to,

27:38

is this this establishment of this ANU

27:41

energy, which is this physical uranium fund

27:43

that was just established in Kazakhstan.

27:46

And it was seed funded partially

27:48

by cause Adam prom partially by the national

27:50

bank of Kazakh, Stan with initial 50 million

27:53

combined. But they're going to do a follow on round the 500.

27:56

And I think that there, the potential

27:58

for there to be huge, huge

28:01

investor appetite for

28:03

a fund like this in the east is.

28:06

Understated. So if,

28:08

if they can continue to raise a lot of money and purchase

28:10

physical uranium, that's coming out of cause Adam prom

28:13

primarily, or some of their JVs, I should

28:15

say Kazakh, Stan, or it

28:17

was Becca, Stan. This is supply that, you

28:19

know, cause I had a problem. Half of their supply goes to

28:21

China, just straight up, like full stop.

28:24

The rest of it. They've got a bunch of JVs with uranium,

28:26

one with Orono, with Chinese. So

28:29

whatever's left over. They've been the most. Consistent

28:32

reliable supplier of uranium for many, many years.

28:34

So now. A physical, financially

28:36

driven fund in the east that

28:38

has an appetite for uranium produced

28:41

in the east. That just, that

28:43

could be a big game changer. Then it's just one more

28:45

piece to that demand, puzzle that again,

28:48

it's hard. You, how do you justify how to,

28:50

how to table the amount of demand

28:52

is going to come from that? I have no idea. How do you put

28:54

that into a model? You can't really, but.

28:57

500 million. What is that going to be another 10

28:59

million pounds next year? What if they do that? Every year? That's

29:02

10 million pounds of demand out of 185

29:05

million for the entire world over the course

29:07

of the year. It's significant. So

29:09

that's something that has big potential to,

29:12

to, to shake things up. Got

29:14

it, got it. I think the word squeeze

29:16

is super interesting because it suggests that

29:18

we have this rapid rise and

29:20

then. At least some sort of fall,

29:22

if not rapid, but a fall to some average

29:25

or some mean let's say that this thesis does play out

29:27

and over the course of a year or the next 18

29:29

months, what signal

29:32

are you looking at to tell you that? This is the top.

29:34

To signal the top of the, of the overall

29:36

bull market? Yes. Well, there's a few pieces.

29:40

Interestingly enough with Sprott. One of the

29:42

pieces that we would consider that

29:45

we would have considered would be hedge funds,

29:47

selling their uranium back into the market. Now

29:49

that it's likely that a number of the hedge funds had already

29:52

purchased uranium have, or

29:54

will sell their uranium distraught in exchange

29:56

for trust units. It's unlikely

29:58

that that's going to be a major signal and

30:01

Sprott is not going to be a seller. So they're, they're

30:03

a buy and hold fund. So that's a signal that kind

30:05

of, that we've lost. Unfortunately. If

30:07

we see a hard spike

30:10

of the spot price above the term price, that's

30:12

something that you have to watch

30:14

out for because it typically doesn't last.

30:18

And so, and it might cause a speculative,

30:20

you know, fury in

30:22

the, in the equities markets and

30:25

that's something really to look for. If we see

30:27

that hard spike on the spot over term During

30:29

euphoric moves and the equities along

30:32

with euphoric moves in the spot price,

30:34

then you start to look for technical signals of

30:36

that breaking down for us. And that's just

30:38

basic technical analysis in

30:40

in the Sprott physical uranium trust will be one of them because

30:44

they stay so close to their net asset

30:46

value. That they really will

30:49

be a good marker for tracking the

30:51

price of the commodity. So if you see

30:53

that ticker start to roll over you know, if

30:55

you see, if you see that fall

30:57

down below the 50 day, moving

30:59

average, after a euphoric move

31:01

up, that feels and looks

31:04

unsustainable. And, you know, as, as

31:06

being driven by financial interests, that

31:08

would be a moment to take some off the table. And

31:10

yeah, it's, it's, it's supposedly charts breaking down.

31:12

Of course we always recommend that treat individual

31:14

patient positions individually because they, they

31:17

do act differently. Let's see what else.

31:19

Those are kind of the main signals that we're looking for. Primarily,

31:22

we're looking for an overshoot of the spot price

31:24

of the term price and have a, have

31:26

a technical breakdown after

31:28

a euphoric move that is

31:30

not driven by, let's say classic.

31:33

Market fundamentals, more

31:36

of speculations. Sure, sure. And

31:38

you know, the sentiment that I've got from you so far is that

31:40

you're still heavily bullish. In the last week we've

31:42

seen somewhat of a. Decent

31:44

selloff, I would say. So considering that, and I, you know,

31:47

I kept reading about seasonality, seasonality,

31:49

seasonality, I guess, what impact

31:51

is seasonality having? It sounds like there is no seasonality.

31:54

And as of right now, are you waiting for

31:56

the knife to keep falling? Is there a knife that's

31:58

falling or are you a heavy buyer? Oh,

32:00

I've been buying, I've been heavily buying the past

32:03

week and a half. Yeah. No, I mean, there still is

32:05

an aspect of seasonality. The interesting part

32:07

about seasonality this year. Usually the drivers

32:09

of that seasonality are, you

32:11

know, twofold one it's

32:14

the U S utilities have a renewed budget

32:16

October 1st. And

32:18

there's a number of nuclear fuel conferences

32:21

that happen in the autumn. You

32:23

have the WNA that happened in September. Then you have

32:25

the NTI that happens in October. And then there was

32:27

just another one. So there's a lot of the utilities

32:30

they meet with other industry players with other

32:32

utilities, they kind of discuss their plans, but

32:34

what's happening right now is that utilities are recognizing

32:37

what's going on with this broad vehicle. And they're sort of like sitting

32:39

out with the spot market. And so

32:41

I still think that we see a

32:43

strong end to the seasonality move. And

32:47

as far as is it happening or not? I mean, the ETFs

32:49

are up 20% since October one.

32:52

So even with this sell off. That's

32:54

a good move, you know, over the course

32:56

of six weeks. So as far as I'm,

32:59

when I look at the charts and zoom out a little bit, it's like seasonal

33:01

is absolutely happening. This looks to me like

33:03

a higher, low that we're making in the markets.

33:05

Of course, there's always a chance that it sells off

33:08

more. My opinion it's sold off more than

33:10

I was expecting, but it's not really a concern.

33:12

It's a buying opportunity for anybody.

33:14

That's kind of late to the game are still adding their positions

33:16

in my opinion. So yeah, I think that,

33:18

I think I've been sick since

33:21

brought, came on the scene. I've expected

33:23

a I

33:26

I've I've changed my vision of the market

33:28

of being a two to four year

33:31

healthier, slower bull market to

33:33

being more of a one to two year faster

33:35

split speculation followed

33:37

by a long grinding bull

33:39

market. Now,

33:44

now what I'm thinking, as

33:46

far as. Hedge funds

33:48

selling some of their uranium distraught in exchange

33:51

for, for trust units and potentially

33:53

some carry traders doing that reverse

33:55

trade. It's likely that we'll see some

33:58

more material come in for Sprott, and

34:00

it might not be as violent to the upside,

34:02

which would mean a longer, more drawn out

34:04

bull market, which in my opinion is way healthier.

34:07

It's less exciting from a speculative

34:10

state standpoint as less volatile. But

34:12

it's healthier for the, for the uranium market.

34:15

It's healthier for the nuclear market. The last

34:17

spike that happened in 22,607,

34:19

it happened so fast that all of

34:21

these developers were just desperately trying

34:23

to get their projects financed and built so they

34:25

could sell into it. And, and almost

34:27

none of them did. I think one mine got built

34:30

to the point where I could actually come into production in time

34:33

only to have the price just turning drop back

34:35

down from 134 bucks a pound back

34:37

down into the sixties and seventies. So

34:40

Yeah, I think I mean the short term is always

34:42

difficult to predict for the uranium market. So we

34:44

try not to do that too much. But

34:46

what we generally recommend what I've been

34:48

recommending since August,

34:51

or really since the beginning of this year, especially

34:53

since the announcement of Sprott is if the

34:55

market gives you sell offs, hang on.

34:58

If you're fully positioned and if you're not take

35:00

advantage of it. So that's what I've been doing

35:02

personally. Nice. Yeah. I mean,

35:04

stay away from the short dated call offs.

35:07

Yes. Yes, absolutely. Absolutely

35:10

long dated call options. We've been doing these

35:12

bullish vertical call spreads that have worked extremely

35:15

well, but they have much less risk

35:17

than the short dated call option. Justin, this has been great.

35:19

I like to end every interview

35:22

by asking a pretty open-ended question, which is what

35:25

is a topic in this particular field

35:27

you feel isn't discussed enough is discussed

35:30

incorrectly or hasn't gotten enough exposure.

35:32

And this is sort of in line with the demand question I asked earlier,

35:34

but more open-ended from the investing

35:37

side or from the nuclear, like nuclear

35:39

Martin energy side. Nuclear

35:42

energy side. I would say what isn't discussed

35:45

enough is how safely and how well

35:47

waste is stored and how, how less

35:49

of an issue it is than most people believe. I

35:52

think that that's any time

35:54

I even speak with somebody who's pro-nuclear,

35:57

that's like just everyday, you know, conversation

35:59

at a dinner party or something. And they asked me what

36:02

I do. We talked talking about nuclear energy. Like,

36:04

oh, I'm so behind it that it's just, man. What

36:06

about the waste? And then I tell them that all

36:08

of the ways that were produced in the United States, since

36:10

the fifties can be stored on a single

36:13

football field, 30 feet high, and they go really.

36:16

And there's never been an accident with nuclear waste in the states.

36:18

Really? Yeah. It's stored extremely

36:20

safely, highly, highly, regularly. What

36:23

is in the news is that the United States

36:25

hasn't come to an agreement on a central storage

36:28

facility, which they've been pushing,

36:30

you know, to put an in Nevada in Nevada is like, yeah,

36:32

we don't want to hear. So I think that

36:34

that, that issue is largely

36:37

under-discussed in terms of nuclear market. The other

36:39

thing is that in terms of renewables, that

36:41

most people don't understand. Renewables. If

36:43

they make up more than a certain percentage of the grid essentially

36:46

require more fossil fuels they,

36:48

they require a backup energy

36:50

source to be able to cycle up

36:52

and down when the sun's not shining, the wind's not

36:54

blowing. So the renewables have their

36:56

place. I'm not anti. But

36:58

I'm definitely anti making renewables 50%

37:01

of the grid because you have to have

37:03

a backup source of energy. And

37:05

so and some of the new nuclear technologies

37:08

and some of these SMRs have technology

37:10

built in or where they can, they can cycle up and down

37:13

far easier than the larger traditional

37:15

reactors. So that's really cool. But

37:17

yeah, the nuclear thing, if you close a nuclear

37:19

plant, fossil fuels got to pick up the pieces.

37:21

So, and most people don't understand that from

37:24

the investing side. I would say that people need to do

37:26

more work when it comes to what to buy.

37:29

I think that you really need to look at the share structure

37:32

of a company and that's something that most investors,

37:34

most retail investors never do. They,

37:36

they read the, you know, the online presentation

37:39

and they see that it's you know, maybe

37:41

it hasn't performed as well as the others. So it's got to make

37:43

up for lost time, you know, it's it's,

37:45

it has a smaller market cap, or I've got

37:47

this guy that I've got that guy on the team they're right next

37:49

to this other. And those sorts of things

37:51

are kind of like the cute things to

37:53

look for on the presentation, but you really

37:56

have to look at the Sheriff's structure, how the company is structured

37:58

in terms of the free float, in terms of the

38:00

insider ownership institutional. How many

38:02

outstanding Morrison options there are and how

38:04

that might affect the stock going forward. And

38:07

yeah, and then the ETF flows, it's

38:09

all about flows. Valuations don't matter anymore.

38:11

They just don't look at Tesla. Look

38:13

at ribbon that doesn't matter. You

38:16

know, you look at the AMC, some of these wall

38:18

street bet, squeezes, valuations

38:20

don't matter anymore. It's, it's a fun flow

38:22

of funds story, and that's likely

38:25

going to have these pullbacks. We're

38:27

going to have these pullbacks, but it's going to continue to

38:29

increase. Got

38:31

it. Got it. Actually, I just, I just remembered something. I

38:33

don't know if you've heard about Dorian I'm luxury. You've heard of 3m.

38:36

Is that a legitimate, I guess over 15

38:38

year period, as many, is that a legitimate competitor

38:40

to nuclear energy? Is that something that can be

38:42

an actual substitute to nuclear, a better substitute

38:44

to nuclear? You know, that's, that's a tough one

38:46

and I don't necessarily have the best answer for that.

38:48

I think it's still something that's being worked on.

38:51

I think that it has a lot of. I believe

38:53

that there is technology that involves using both

38:55

3m and uranium in the same reactor.

38:57

I don't know if Dorian can replace

39:00

uranium and the reactors that are already constructed.

39:02

I don't believe it can, without some

39:04

modifications, I could be wrong on

39:06

that, but I'm not a nuclear engineer. But I do know that it

39:08

holds promise and it's still, there's definitely

39:10

still research and work being done into it. I think that

39:12

there's a future for Florian. So

39:14

I think that, for example, like the Chinese

39:17

that are having these build-out plans for

39:19

having 200 gigawatts of nuclear in

39:21

my, from my understanding, that's all,

39:23

it's all uranium with their builds that

39:25

they're planning. So I don't see it as

39:27

a disruptor necessarily

39:30

to be investing thesis. But

39:32

I think that there's great promise for throwing them in the future

39:34

for sure. Great, great, Justin,

39:37

thanks again for coming on. You can find justin@uraniuminsider.com.

39:40

Sounds good. Thank you..