The Core Case for Uranium

Key Takeaways:

• Sulfur Supply Disruption: Huhn identifies sulfur imports through the Strait of Hormuz as the most direct near-term supply risk from the Iran conflict, affecting Husab in Namibia at 13 to 15 million pounds a year, Rössing, and Lotus-operated Kayelekera in Malawi. He notes Kazatomprom's full-year 2025 results showed sulfuric acid costs rising almost 50% over the year, before this disruption began.
• Term Market Standoff: Huhn describes continued head-butting between producers and utilities, with Cameco pushing for market-referenced contracts — he cites an illustrative structure of an $85 floor and a $160 ceiling — that utilities are reluctant to accept after fifteen years of base-escalated and fixed-price agreements. Over 70 million pounds were contracted in Q4 2025, while the official year-to-date tally sits at roughly 15 million pounds and does not yet include Indian contracting with Kazakhstan and Canada.
• Producer Depletion: Huhn frames Cameco's contracting posture as a response to a declining resource base, with Cigar Lake ending around 2035, McArthur River around 2041, and the Inkai joint venture around 2050 — and Orano facing what he calls an even bigger pipeline problem. He adds that Cameco's intent to loop fuel-cycle deals into Westinghouse AP1000 builds would allocate future production to new reactors, tightening the market for existing utility customers.
• Development Lead Times: Using NexGen Energy's Arrow deposit as the benchmark, Huhn notes the company has received its development license and projects a 54-month timeline from construction to production, implying ramp-up in 2031 and first meaningful production in 2032 — roughly twenty years from discovery, and only if construction goes smoothly. He observes that most industry analysts consider that timeline optimistic.
• Life Extensions Versus New Supply: Huhn points to France's February blanket approval extending its 900 MW and 1300 MW fleet — 52 of its 57 reactors — from 40 to 50 years, which he estimates will consume almost 250 million pounds of uranium. He contrasts that single sovereign decision with Rook I, which he says will produce roughly 230 million pounds over its entire mine life despite utilities treating the project as the sector's savior.
• China and U.S. Build-Out: Huhn describes China as having entered fleet mode with 33 reactors under construction, eight to ten approvals a year, five-year build times, and a target of 150 to 200 gigawatts by 2035 against roughly 55 to 56 gigawatts today. In the United States he points to a binding $80 billion Westinghouse agreement covering ten AP1000s, a Japanese-funded commitment of $40 billion toward BWRX-300s in Tennessee and Alabama, and NRC reform — signals he expects to matter more for Western sentiment than for near-term supply and demand.
• Equity and Price Cycle: Huhn attributes recent equity weakness to broad-market pressure rather than sector fundamentals, and describes a repeating pattern in which the long-term price consolidates for twelve to eighteen months then steps up, with the market currently in month five of a move from $80 to $91.50. He says his modeling shows a supply deficit over a five-to-seven-year window and that the risks he can identify — SMR acceleration, sovereign stockpiling, utility restocking — are predominantly to the upside, though too speculative to model.

‍