Uranium Insider: Deficits Ahead as Nuclear Demand Goes “Off the Charts”

Key Takeaways:

• Sulfur Supply Disruption: Huhn says Russia has halted sulfur exports until the current disruption resolves, which matters because Kazakhstan sources the portion of its sulfur it does not produce domestically from Russia. He also points to Namibia's Chinese-operated Husab mine — roughly 13 million pounds a year — which makes its own acid but imports the sulfur feedstock, and argues the combined effect could raise costs and potentially reduce output in both jurisdictions.
• Inventory Overhang Exhausted: Huhn argues that apart from the initial commercial ramp of the 1950s and early 1960s, the sector has never been this dependent on production coming directly out of the ground. He notes roughly 1.8 billion pounds of commercial inventory exists globally, but discounts it heavily given consumption rates and the share China holds and will not sell.
• Reactor Growth Projections: Against approximately 440 operating reactors and 400 GW of capacity, Huhn cites UxC's reference case pointing to 500 GW — a 25% growth rate — within five to six years, underpinned by 81 reactors under construction, half of them in China. He highlights that UxC's low case now shows growth for the first time the firm's analysts can recall, where five or six years ago it modeled premature shutdowns.
• Secondary Demand: Financial buyers took more than 10 million pounds last year, and Huhn puts the figure closer to 15 million including hedge funds re-entering in Q2. He treats utility restocking, sovereign and strategic stockpiling, and military demand as additional sources that are difficult to model but unlikely to be zero.
• Hyperscaler Engagement: Huhn describes direct conversations underway between big tech buyers and Westinghouse, GE Vernova, Urenco, and Centrus, and says NexGen has been approached regarding project finance and potential offtake from Rook I. He points to the first BWRX-300 at Darlington, Ontario, where operator OPG issued an RFP in 2024 — the same year construction began — as evidence that SMR-linked uranium demand arrives when shovels hit the ground rather than years later.
• Term Market Signal: With spot around $85, Huhn notes the term price at $94 versus $80 a year earlier, and reads Cameco's disclosed contract terms — predominantly market-referenced, floors in the $70s, escalated ceilings at $150 — as a confident producer bet on higher prices. He expects triple-digit term pricing this year and says he is already hearing of triple-digit fixed and base-escalated contracts being signed.
• Denison and Hard-Rock ISR: Huhn believes Denison's ISR approach at Phoenix will work based on test results, while flagging open questions about fluid flow and production steadiness in granite compared with conventional sandstone ISR. He credits the company's financial management and expects a re-rating if initial ramp-up succeeds, adding that a proven method would open possibilities for similar deposits across the Athabasca Basin.

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