Ben Finegold: Uranium Cycle Still Early, What Will Kick it to the Next Stageyoutu.be
As interest in uranium continues to grow, what stage is the market at right now?
Speaking to the Investing News Network, Ben Finegold, who focuses on uranium research at Ocean Wall, said it’s still early — he believes the cycle is in its second or third inning, and he shared his thoughts on what will push it further.
Looking back at recent activity, Finegold said that while 2021 was the year of price inflection, 2022 has been the year of term contracting, with 100 million pounds expected to be contracted in the term market by the end of the year.
Both of these factors are positive, but it’s institutional investment that will bring the uranium space into its next phase.
“I think for us really to hit that later-stage stride of this cycle, institutional capital needs to come back into the sector in an even more aggressive way than we have seen,” he explained, adding that retail investors also have a role to play.
Prices are a key area of focus for market participants, and Finegold said the spot price will probably go to US$75 per pound next year, and likely US$60 by the end of 2022. He sees term market pricing reaching US$90 to US$100.
“(Inflationary pressures have) really resulted in almost a twofold increase in the breakeven price for western miners — we’ve seen breakeven levels as high as US$90,” Finegold said. “So the price needs to in essence double in order to bring this back online.”
When it comes to investing in uranium, Finegold pointed out that the sector has been reduced from around 600 publicly traded names in 2007 to only about 70 today. There are also of course options for physical exposure.
“As the spot price moves, the actual assets of these uranium companies will improve with spot,” he said during the interview. “We are incredibly bullish on the spot price, and there’s some amazing opportunities out there on the development stage, on the exploration stage, for some of these companies. We are bullish on the sector as a whole.”
Watch the interview above for more from Finegold on uranium, including how to approach the sector as an investor, and Ocean Wall’s analysis of Kazatomprom’s (LSE:KAP) supply network.
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Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.
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