Buy Uranium
AI revolution or not, demand is set to soar while supplies are constrained.
For all the talk of decarbonizing the economy over the past 20 years, it’s shocking how rarely nuclear energy was brought up as a zero-emission alternative. Solar and wind, while useful additions, were never viable for base load power. It was absurd to ever pretend otherwise.
Thankfully, that has changed. The U.S. government has accepted reality and aggressively pushed into nuclear energy, pledging to increase nuclear output by 300%.
The impetus for this was the massive power needs of AI.
Frankly, I’m not convinced AI is going to be quite as big of an energy hog as advertised. In every case I can remember, technology has always gotten more energy efficient over time. I don’t know why AI would automatically be different. Somewhere there’s a brilliant engineer out there figuring out how to train and run AI on the cheap. When the incentive exists, competitive capitalism has a way of delivering the goods.
But here’s the thing.
Even if the AI capital spending bubble bursts — and I expect that it will — the nuclear buildout will continue. America was thirsty for energy long before AI because a buzzword. And the plans in place can’t be turned on a dime.
But let’s say I’m wrong about that. Let’s say the AI bubble bursts and all new nuclear energy development grinds to a halt. Well, we’re still looking at fantastic conditions for a durable bull market in uranium. Our existing nuclear energy is already using more uranium than is being mined… and these deficit conditions have been in place for 13 years and counting.
I would go into detail but, frankly, Daniel Doge has already done a better job than I ever could of explaining the factors likely to push uranium prices hundreds of percent higher from here.
You can read his full analysis here, and I strongly recommend you do, as Daniel does excellent work. But I have included a lengthy excerpt below, edited slightly for brevity.
Be sure to read through to the end because I offer a few recommendations on how to play this bull market.
The Last Time This Happened, Uranium Jumped 20X
By Daniel Doge
Uranium has been in a structural supply deficit for thirteen consecutive years.
For thirteen straight years, the world’s nuclear power plants have consumed more uranium than miners have pulled out of the ground.
And during that time, utilities, the people who actually need this fuel to keep the lights on, have only contracted for about 45% of their annual consumption.
They’ve been kicking the can down the road. Drawing down inventories. Assuming someone else will solve the problem.
Grant Isaac, President of Cameco, one of the world’s largest uranium producers, put it bluntly at a recent conference:
“If we had all our fuel buyers in one room, the reality is not a single one of them doubts this gap. They all understand that the uranium price needs to go up. Just 100% of them believe it’s somebody else’s problem.”
Every single buyer knows the price has to rise. Every single one thinks they won’t be the one caught holding the bill.
That’s a game of musical chairs. And the music is slowing down.
The Demand Tsunami
Six years ago, the World Nuclear Association estimated that global reactors would need about 260 million pounds of uranium annually by 2040.
In 2023, they revised that number to 328 million pounds. Their latest estimate? 390 million pounds.
A 50% increase in projected demand in six years. And what’s driving this demand is real policy commitments from the world’s largest economies:
The U.S. aims to begin construction of at least eight large reactors by 2030 and quadruple nuclear capacity by 2050.
China is targeting 400 GW of nuclear capacity by 2060 — 26 reactors under construction, 42 more planned.
Japan is restarting reactors and targeting 20–22% of energy from nuclear by 2030.
South Korea reversed its nuclear phase-out entirely.
The UK is planning 16 GW of new capacity.
We’re witnessing a global policy stampede toward nuclear power driven by AI’s insatiable appetite for electricity, the need for energy security, and the reality that you cannot decarbonize a modern economy without nuclear baseload power.
Every single one of those reactors needs uranium to run. And the supply side? It’s a mess.
The Supply Side Is Broken
Global uranium production last year came in around 165 million pounds.
Annual demand from the existing reactor fleet, before any new builds come online, runs between 190 and 200 million pounds.
That’s a deficit of 25 to 35 million pounds per year, right now, today.
And it’s getting worse.
Kazakhstan has supplied roughly 40% of the world’s uranium for years. Now its largest mines are nearing peak output.
Niger, historically an important supplier to Europe, saw its elected government overthrown by a military junta in 2023. The junta seized control of the country’s main uranium mine. Last year, production was zero.
In Canada, the McArthur River mine lowered its 2025 output due to development delays. In the U.S., in-situ recovery mines have resumed operations but are running behind schedule.
Only two large-scale mines could come online in the next few years… Denison’s Wheeler River and NexGen’s Arrow deposit.
Wheeler River just got its final permit, but won’t produce before mid-2028.
Arrow, the highest-grade uranium deposit on the planet, is still in permitting and might not start until 2031 or 2032.
Meanwhile, the cumulative production deficit through 2040 is estimated at 1.125 billion pounds.
During the last uranium bull market, the price ran from $7 to $137 per pound, roughly $200 in today’s dollars.
And that was without a structural supply deficit. The price spiked purely on fear of a shortage after a major mine flooded.
Today, the deficit is real. The demand acceleration is real. The supply constraints are real.
Why This Is a National Security Problem
The U.S. government issued a Section 232 proclamation on critical minerals, specifically naming uranium as a national security vulnerability.
The numbers should keep policymakers up at night.
America currently produces less than one million pounds of uranium per year, against a domestic need of roughly 50 million pounds. Half of our supply comes from Russia, Uzbekistan, and Kazakhstan.
If the U.S. follows through on its plan to quadruple nuclear capacity, it would need to increase uranium enrichment capacity twelvefold, assuming all fuel is domestically sourced.
Jean-Luc Palayer, CEO of Orano USA, flagged that number. Twelvefold. In an industry where it takes a decade to permit and build a single mine.
The Section 232 proclamation directs the U.S. to negotiate with trading partners and consider remedies such as price floors and trade restrictions.
The Department of Energy has already committed $2.7 billion to strengthen domestic uranium-enrichment services over the next decade.
As it stands, this is a structural repricing that could take years to fully play out.
The last time fundamentals were even remotely this tight, and they weren’t nearly this tight, uranium went from $7 to $137.
Charles here again…
So, are we looking at another 20X move in uranium prices?
I won’t hazard a guess on that. I don’t make a habit of making precise price forecasts because there are always too many variables to consider.
But I will say this…
I do believe that the conditions are in place for a major bull run in both the price of uranium and in the shares of the companies that mine it. Some of these companies aren’t particularly easy to invest in. I’m sure Kazakhstan is a lovely country, but I don’t particularly like the idea of buying stock there.
There are a small handful of American ETFs that offer exposure to uranium. Let me share my favorite one with you now.
