Yellow Cake Share Discussion Threads

[weaverbeever] 13/10/2021 21:55

Can someone point me in the direction of a reliable site to keep an eye on the spot price please

[7kiwi] 13/10/2021 21:54

Apparently closed at $46.50, still a big %-age increase

[7kiwi] 13/10/2021 19:22

Energiser,

I am not sure Morgan Stanley understand the market, either that or they are being deliberately obtuse. The supply-demand fundamentals are that there's a massive structural supply deficit.

Demand: ~175m lbs
Primary supply ~125m lbs
Secondary supply ~20 m lbs.

Deficit: ~30m lbs.

There have been deficits, albeit smaller, for the past few years and are forecast to remain for the next few years. At some point the inventory providing secondary supply will be consumed and as utilities ramp up (for example Japan restarts, US life extensions etc) then available secondary supply from under-feeding will dry up.

The next few years (probably 2022 and 2023 as peak) there's a big deficit. If that coincides with inventory drying up, there's going to be a big spike. It will take ~2 years to being McArthur River back on line and KAP have said they are going to exercise supply discipline through the end of 2023, and in any event it takes 12-18 months to get meaningful production increase from their wells.

There's a couple of US companies that might be able to produce some, but they are relatively small beer a 2-3 m lbs per year. But if they started now, it will be at least 12 months before they get production.

[energiser01] 13/10/2021 18:45

Never quite understood the statement “ Morgan Stanley warned that supply-demand fundamentals did not change over the last months to warrant the price surge”. Sprott buying and removing anything not nailed down, was not a catalyst. A skeptic/conspiracy theorist might think Sprott asked MS to put that statement out, so they could hoover up some more on any price weakness…̷0;dyor etc. etc…

[7kiwi] 13/10/2021 18:27

allstar,

Someone posted it on Twitter. Follow John Quakes (@quakes99).

[allstar_07] 13/10/2021 17:27

Where do you get the spot from? The trading economics link is always delayed.

[7kiwi] 13/10/2021 17:16

Blimey,

Spot back at $47.50.



That puts YCA at about a 1% premium by my calculations.

[bpdon] 13/10/2021 16:31

I skimmed 20% of my YCA at 380p as well @capo1211. The premium was massive (>20%) and was baking in a huge turn around in the U price. It felt like it was getting ahead of itself fuelled by last nights Sprott feasting.

But..... it looks like that bounce has arrived. What an incredible rebound on the spot price with a mid-price of $48 being reported. By my calcs that would have us back to a slight discount.

[bmcb5] 13/10/2021 15:43

$46 U traded. Bouncing back quickly

[capo1211] 13/10/2021 13:04

personally I took profits today. Share price seems to have run away from spot, hope to get back in later.

[jonwig] 12/10/2021 17:59

I see Macron is talking small nuclear reactors now. Our first should be operational around 2030.

[goodgrief] 12/10/2021 16:56

Reckon the general public's view of nuclear will change once their winter energy bills hit the door mat and/or the lights go out!

[cf456] 12/10/2021 16:49

"Soaring gas prices, worldwide energy shortages, fears for energy security and an ambition to have net zero carbon by 2050 have put nuclear power back on the map after a decade in the cold."

[kinbasket] 12/10/2021 12:21

Finland lobbies nuclear energy as a sustainable source

....the Finnish government will lobby the European Union to declare nuclear power as a sustainable energy source....

As reported by the Finnish Broadcasting Company (YLE), the government’s alignment to lobby nuclear as a sustainable source marks a near U-turn within the Green Party sitting in the current five-party cabinet. Traditionally the party has been fiercely anti-nuclear and has resigned from previous governments over the issue. Its views have become more pragmatic, and the Greens now claim to have a technology-neutral attitude when it comes to fighting climate change.

[jonwig] 12/10/2021 09:30

FT has another informative article on the uranium market. Snippets;

Funds such as Ben Melkman’s New York-based Light Sky Macro, Anchorage Capital and Tribeca Investment Partners have been positive on the outlook for the raw material, as a global energy crunch highlights the role of nuclear power in a transition away from fossil fuels.

“We’ve been patiently waiting for something to happen for a long time,” said Ben Cleary, of Tribeca Investment Partners in Singapore, whose fund is up 345 per cent net of fees this year. “Clearly there’s speculative money coming back into the sector, there were massive price moves in September.”

Canadian asset manager Sprott has catalysed the price rise with significant buying of uranium, but investors say the broader energy transition is highlighting the key role of nuclear — a low-carbon source of baseload power.

The rapid rise in natural gas and coal prices to fresh highs this month has exacerbated an energy crisis in Europe and China, and has “placed uranium back in the spotlight”, said Rob Crayfourd at CQS New City Investment Managers.

“The political fallout of this energy crisis will be a greater willingness in the west to extend the life of the existing reactor fleet,” he said. “It has focused governments on the benefits of secure supply of energy from the nuclear fleet. We expect that to lend support [to prices].”

Light Sky’s founder Melkman, who was previously a partner at hedge fund Brevan Howard, has gained more than 5 per cent this year, said a person who had seen the numbers.

“Light Sky Macro sees an immediate and sizeable opportunity in the uranium sector, making it one of our highest conviction views for 2021,” he wrote in a note to clients, seen by the Financial Times, earlier this year.

A drawdown of inventory during the coronavirus pandemic has compounded tightening supply, while demand is expected to surge in the coming decades, added Melkman, who has been investing in the sector since 2018.

“The growing focus on ‘green energy’ at a political level and the growing demand for [sustainable] assets in the investment community should turn uranium into one of the most asymmetric trades for the coming years,” he wrote, meaning that the possibility of potential gains far outweighs the risk of losses.

Also profiting is Sean Benson, founder of London-based Tees River. His uranium fund, which buys equity stakes in uranium miners, is up 115 per cent this year.

Benson argues in an investor letter, seen by the FT, that a deficit of supply relative to demand and a “very supportive” climate change agenda mean that “the current uranium cycle is better than the last on every fundamental metric”. His Critical Resources fund, which invests about one-third of assets in uranium, is up 44 per cent this year.


NB. "Better than the last" - and that was $136.

[jonwig] 10/10/2021 11:26

Tropical cyclones are caused by equatorial warming. Global stilling by the temperature gradient between equator and poles. The two are perfectly consistent with each other.

[7kiwi] 10/10/2021 11:14

Wind will always be intermittent that requires backup or expensive storage.

But don't pay too much attention to the climate change crusties. They simultaneously believe in "global stilling" and increased frequency and intensity of tropical cyclones.

They're just trying to deflect from the fundamental deficiencies of wind to run a modern economy.

[jonwig] 10/10/2021 10:13

The FT has an article on "global stilling" - wind speeds across northern Europe have been as low as 50% of average for much of this year. This explains a part of the current energy crisis, as renewables can't take up the load. Our UK gov't is unlikely to spell out that our renewables contribution to energy supply is far below expectation.

The phenomenon is thought to be caused by the poles warming by more than the equator, reducing the temperature gradient. If so, it won't be just a passing phenomenon.

Personally, I'll be divesting from any renewables trusts which hold significant wind assets in their mix, but the most obvious implication is for nuclear energy to be a larger and more urgent contributor.

[hpcg] 03/10/2021 21:22

I got the total from here at the end of the day on Friday, when I posted:

I find all those calculations unconvincing because it implies a significant component of our consumption goes into building generation, when we know very little does. In the UK our oil consumption is almost all for transport, and gas not used for electricity is used domestically for heating and cooking. Yes we've outsourced energy consumption now, but not a lot of plant was built.

Also I find the space element bemusing; I think this is a function of being in England which makes us think everywhere is crowded when even in Europe most places are open.

- search it on satellite.

And it is all really a waste of time, because what matters here, especially for further decent games, is the money Sprott, and possibly Yellow Cake, can raise to buy Uranium Oxide.

[7kiwi] 03/10/2021 09:47

I've done a bit more digging on EROI calculations. It seems to me that the EROI depends on who is doing the study.

First, there's this one,

It puts wind at 16 (without storage) and 4 (with storage). It doesn't seem to differentiate between onshore and offshore wind. Solar PV at 4 (without) and 2 (with storage).

Nuclear is 75. With gas and coal at 28-30.

Then there's this study which turns that on its head:

This puts wind at 20 and solar at 6.

Then nuclear is 5. Natural gas is put at 7 and coal at 18.

So, depending upon your source, you can make any argument you like.

[7kiwi] 02/10/2021 00:42

Looks like we've moved back to a bit of a premium.

[7kiwi] 02/10/2021 00:41

hpcg,

I think there might be a bit of exaggeration in there. But the underlying messages that:

a) The Energy ROI of wind and solar is low and
b) The energy density of wind and solar is low and
c) The land/sea area intensity required to produce wind and solar is high

are all true.

And they produce intermittent electricity. Solar is pretty predictable. But the basic physics are that it produces most during the day in the summer when demand is low and nothing at all during winter evenings when demand is high. Wind is highly unpredictable. The wind fleet produced virtually nothing for several weeks just recently. So, back-up fossil fuel generation is required. Running those fossil fuel plants only to back-up wind destroys their economic model.

And you are exaggerating too. 411Gwh, would mean an average of 17GW for the whole day. Looking at gridwatch, it looks about 10GW on average for Friday. From an installed capacity of ~24GW (iirc).