Energy Fuels Applauds President Trump’s 10-Year, $1.5 Billion Plan to Establish U.S. Uranium Reserve

Energy Fuels applauds President Trump for announcing a budget that seeks $150 million per year over 10 years to establish a strategic uranium reserve.

Energy Fuels Inc. (TSX:EFR, NYSEMKT:UUUU) (“Energy Fuels” or the “Company”), a leading uranium producer in the U.S., applauds President Trump for yesterday announcing a budget that seeks $150 million per year over the next 10 years (totalling $1.5 billion over that timeframe) to establish a strategic uranium reserve intended “to provide additional assurances of availability of uranium in the event of a market disruption.” (“A Budget for America’s Future”, Page 46; “Table 25-1. Federal Budget by Agency and Account, FY-2021 President’s Budget Policy”, Page 127).

This follows the President’s action in July 2019 to establish the U.S. Nuclear Fuel Working Group (NFWG) to investigate all aspects of nuclear fuel production and “to develop recommendations for reviving and expanding domestic nuclear fuel production,” of which uranium production is the critical first step.

The President’s plan to build a strategic uranium reserve “reflects the Administration’s Nuclear Fuel Working Group (NFWG) priorities,” and notes that the “NFWG will continue to evaluate issues related to uranium supply chain and fuel supply.”

Further, in a press release issued yesterday, the U.S. Department of Energy stated: “The new program will help to reestablish the nation’s nuclear fuel supply chain through the domestic production and conversion of uranium.”

Mark S. Chalmers, President and CEO of Energy Fuels stated: “President Trump took action to support domestic uranium miners and promote U.S. national and energy security. This is an important step toward addressing the devastating impact of our nation’s overdependence on uranium imports from Russia and its allies, which is displacing free market uranium and forcing U.S. mines out of business. Additionally, the President’s Nuclear Fuel Working Group is continuing to undertake a comprehensive review of the fuel cycle, and we look forward to additional actions.

“We also look forward to working with the U.S. government on implementing the programs needed to revive and expand domestic uranium mining. As the owner of the only operating uranium mill in the United States, together with our extensive U.S. uranium production portfolio and existing inventories, at Energy Fuels, we believe we are well-positioned to provide a significant portion of the uranium needed for the reserve. Energy Fuels has been the largest uranium producer in the U.S. over the past several years. Our three existing, fully licensed, low-cost uranium processing facilities in Wyoming, Utah and Texas have over 11.5 million pounds of annual licensed uranium production capacity, significantly more than any other U.S. producer, and we are able to commence ramping up production immediately.”

Energy Fuels is a long-term domestic uranium supplier and has an excellent track record of uranium deliveries to utilities and other customers over the years. Energy Fuels’ White Mesa uranium mill in Utah is also a significant supplier of vanadium, which is another mineral critical to national and energy security, and we are evaluating the possibility of processing certain rare earth minerals at that facility. Energy Fuels also plays an important role in the recycling of uranium-bearing alternate feed materials and is involved in the cleanup of historic uranium sites.

About Energy Fuels: Energy Fuels is a leading US-based uranium mining company, supplying U3O8 to major nuclear utilities. The Company also produces vanadium from certain of its projects, as market conditions warrant. Its corporate offices are near Denver, Colorado, and all of its assets and employees are in the United States. Energy Fuels holds three of America’s key uranium production centers, the White Mesa Mill in Utah, the Nichols Ranch in-situ recovery (“ISR”) Project in Wyoming, and the Alta Mesa ISR Project in Texas. The White Mesa Mill is the only conventional uranium mill operating in the U.S. today, has a licensed capacity of over 8 million pounds of U3O8 per year, and has the ability to produce vanadium when market conditions warrant. The Nichols Ranch ISR Project is in operation and has a licensed capacity of 2 million pounds of U3O8 per year. The Alta Mesa ISR Project is currently on standby. In addition to the above production facilities, Energy Fuels also has one of the largest NI 43-101 compliant uranium resource portfolios in the U.S., and several uranium and uranium/vanadium mining projects on standby and in various stages of permitting and development. The primary trading market for Energy Fuels’ common shares is the NYSE American under the trading symbol “UUUU”, and the Company’s common shares are also listed on the Toronto Stock Exchange under the trading symbol “EFR.” Energy Fuels’ website is www.energyfuels.com.

Cautionary Notes Regarding Forward-Looking Statements: This news release contains certain “Forward Looking Information” and “Forward Looking Statements” within the meaning of applicable United States and Canadian securities legislation, which may include, but is not limited to, statements with respect to: any expectation as to how the President’s budget will be implemented and the timing of implementation; any expectation with respect to the Company’s plans to expand and/or resume production at its various projects; any expectation with respect to costs of production, timelines to production and the Company’s ability to maintain its leading position as a producer; any expectation that the President’s budget is a step toward addressing the impact of U.S. overdependence on subsidized uranium imports from Russia; any expectation that Energy Fuels is well-positioned to provide a significant portion of the uranium needed for the reserve through our existing inventories and U.S. uranium production portfolio; and any expectation that Congress will make the requested appropriations. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as “plans,” “expects,” “does not expect,” “is expected,” “is likely,” “budgets,” “scheduled,” “estimates,” “forecasts,” “intends,” “anticipates,” “does not anticipate,” or “believes,” or variations of such words and phrases, or state that certain actions, events or results “may,” “could,” “would,” “might” or “will be taken,” “occur,” “be achieved” or “have the potential to.” All statements, other than statements of historical fact, herein are considered to be forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements express or implied by the forward-looking statements. Factors that could cause actual results to differ materially from those anticipated in these forward-looking statements include risks associated with: any expectation as to how the President’s budget will be implemented and the timing of implementation; any expectation with respect to the Company’s plans to expand and/or resume production at its various projects; any expectation with respect to costs of production, timelines to production and the Company’s ability to maintain its leading position as a producer; any expectation that the President’s budget is a step toward addressing the impact of U.S. overdependence on subsidized uranium imports from Russia; any expectation that Energy Fuels is well-positioned to provide a significant portion of the uranium needed for the reserve through our existing inventories and U.S. uranium production portfolio; and any expectation that Congress will make the requested appropriations; and the other factors described under the caption “Risk Factors” in the Company’s most recently filed Annual Report on Form 10-K, which is available for review on EDGAR at www.sec.gov/edgar.shtml, on SEDAR at www.sedar.com, and on the Company’s website at www.energyfuels.com. Forward-looking statements contained herein are made as of the date of this news release, and the Company disclaims, other than as required by law, any obligation to update any forward-looking statements whether as a result of new information, results, future events, circumstances, or if management’s estimates or opinions should change, or otherwise. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, the reader is cautioned not to place undue reliance on forward-looking statements. The Company assumes no obligation to update the information in this communication, except as otherwise required by law.

It should further be noted that the proposed budgeted activities are subject to appropriation by the Congress of the United States, and there can be no certainty of the outcome of this budget or the Working Group’s study and recommendations. Therefore, the outcome of this process remains uncertain.

Click here to connect with Energy Fuels Inc. (TSX:EFR, NYSEMKT:UUUU) for an Investor Presentation.

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Australia is the second largest producer of uranium in the world. Here's a look at the mines that are producing today, and the significant ones that are being developed.

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For more than a decade, some have warned peak copper is on the horizon. Is the world really running out of the red metal?

Markets and supply chains across the commodities spectrum have taken hits from the COVID-19 pandemic. The base metal copper is no exception. Now, some analysts are once again calling for peak copper in much the same way as others have voiced concerns over peak oil or peak gold.

After the 2008 recession, copper surprised everyone with its rapid ascent — propelled by China's stockpiling program, it hit record-high prices. In 2011, concerns that peak copper was on the horizon were exacerbated by the rapid industrialization seen in China. As the Asian powerhouse's copper demand skyrocketed, copper stockpiles had a tough time meeting the increased demand.


That raised the question of when the market will reach peak copper. The predictions surrounding the timing of peak copper were are all over the map, ranging from 2020 to 2100.

While it's clear now that 2020 wasn't the year copper supplies would peak, there are still signs in the red metal's fundamentals that a tight supply scenario — and higher prices — is on the horizon. Unlike peak oil, which was reversed with the help of fracking, no such technological advancements are available for copper production, and there are no viable alternatives for the metal across its many industrial uses.

Peak copper: China's key role in demand

In the past decade, strong growth from China has resulted in accelerated copper demand. In a market already known to operate on thin margins, Chinese demand has quickly created a copper supply deficit. The potential for other emerging markets to enter periods of rapid growth is also fueling speculation that increased demand for copper has only just begun.

Furthermore, interest in copper as an asset class has been piqued, and prices are now being impacted by investment demand in addition to traditional physical demand. Copper is deemed a strategic asset in China, and it provides a way to diversify from the US dollar and US treasuries.

In 2011, the tightening balance between copper supply and demand resulted in a rapid rise in the red metal's prices. Copper hit a low of US$1.32 per pound (US$2,910.09 per tonne) in January 2009, then surged to US$3.55 per pound (US$7,826.40 per tonne) by April 2010 on its way to an all-time peak of $4.58 per pound (more than $10,097 per tonne) in February 2011.

Copper prices have mostly traded under the US$3 (US$6,600) level for the past decade. However, a looming supply crunch, exacerbated by coronavirus-related supply disruptions, is pushing prices up again. The price of copper reached an all-time high in the second quarter of 2021, trading above US$10,700 per tonne.

Going forward, a long period of undersupply is expected in the copper space, and that has the potential to send prices even higher in 2022 and beyond.

Peak copper: Why supply is lagging

While copper demand is expected to rise, supply may not keep pace. This is resulting in speculation that we are on the path to peak copper. However, according to a 2019 report out of the University of Iceland, the researchers believe that focus on recycling copper scrap will help delay peak copper.

The Copper Development Association pegs the current known worldwide copper ore resources at nearly 5.8 trillion pounds, of which only about 0.7 trillion pounds, or 12 percent, have been mined throughout history. Plus, nearly all of that mined copper is still in circulation, as the red metal's recycling rate is higher than that of any other engineering metal.

So why is the market faced with a supply deficit? The copper supply deficit isn't due to a lack of available copper to mine, it was caused by complications in bringing high-quality copper to the market.

In an interview with Rick Rule at the 2020 Sprott Natural Resource Symposium, Robert Friedland of Ivanhoe Mines (TSX:IVN,OTCQX:IVPAF) said, "The copper price probably needs to double its current price for the average low-grade copper porphyry in Peru or in Chile to become viable."

Similarly, back in 2019, Reuters reported, "The copper industry has suffered from years of underinvestment, and it is now working feverishly to develop new mines and bring fresh supply online as the electrification trend envelops the global economy." Expected global copper shortages have major end users of copper worried about the security of their supply chains.

"There are (copper) deficits being forecast by many of the brokerage firms — Goldman Sachs (NYSE:GS) is one of the ones leading that," Rob McEwen, chairman and chief owner of McEwen Mining (TSX:MUX,NYSE:MUX), told INN in an interview. "I feel that the demand for copper is going to increase with the growth of Asia, with the growth and the proliferation of electric vehicles and (copper's) use in regenerative energy. I think we're entering a strong period of demand for copper."

McEwen Mining recently created McEwen Copper, a subsidiary spinoff of the company's copper assets including the Los Azules project in Argentina.

It's worth noting that copper exploration and mining require a great deal of capital investment. The last major investment cycle was in the 1970s, and although we are currently in a cycle of increased exploration spending, new discoveries are few and far between, and have not been enough to compensate for the decline in ore grades from the larger, older mines.

The other big factor impacting new supply to the market is the time it takes to get a new mine into production. First, an economically viable reserve has to be discovered, and then this discovery has to be developed. Many projects don't even make it past this point. Often, by the time a mine is about to be constructed, the metal's price collapses and the project is abandoned.

What's more, miners that make it past the point of exploration and into construction and mining are faced with a multitude of potentially time-consuming delays, including everything from equipment shortages to permitting problems.

Peak copper: COVID-19 further tightened supply

The worldwide COVID-19 crisis has further impacted the copper supply crunch. In July 2020, Eurasian Resources Group CEO Benedikt Sobotka noted that the impact of the pandemic had shrunk the mine project pipeline due to lockdown-related delays and capital expenditure guidance cuts from copper miners. Sobotka warned that the supply impact of the coronavirus will extend far beyond 2020.

Speaking at a webinar that same month, Bruce Alway, director of metal research at Refinitiv, said, "(There are) sizeable losses for both copper and zinc at the mine level, which at the peak saw around 110 operations affected."

Moving ahead, S&P Global Market Intelligence commodity expert Thomas Rutland stated, "We forecast consumption will outstrip production over the period to 2024, resulting in a growing refined market deficit and increasing copper prices."

Bloomberg reported in October 2021 "Copper's immediate prospects are supported by low inventories, while the shift to low-carbon energy sources paints a rosy picture for the longer term." However, on the other side of the equation, "global shipping bottlenecks and energy shortages in China and Europe are dimming the demand outlook heading into next year."

There are also clear signals further down the supply chain, most notably in China, the world's largest consumer and third largest producer of copper. The slowdown in China's property sector as a result of the debt crisis in the country's real estate market has been the biggest factor influencing the global copper market in 2021 outside of the COVID-19 pandemic.

So is peak copper really coming? Perhaps not yet, but it's clear the supply and demand situation could remain tight, leaving a market that's potentially ripe for investment. If you'd like to learn more about copper's fundamentals, click here to read our introductory guide.

Don't forget to follow us @INN_Resource for real-time news updates!

Securities Disclosure: I, Melissa Pistilli, 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.

It’s important for zinc-focused investors to understand the basics of the zinc spot price and zinc futures.

The zinc market may have had a few rough patches in recent years, but supply disruptions and economic recovery promise to spur a revival for the zinc spot price and zinc futures.

The underdog of the base metals family is appealing in large part because its fundamentals remain strong, with many analysts optimistic about the long-term outlook for zinc.


With that in mind, it's worthwhile for investors interested in zinc to understand how zinc pricing works. Here's a brief overview of what investors need to know about the zinc spot price and zinc futures.

What is the zinc spot price?

InvestingAnswers defines "spot price" as "the current market price at which an asset is bought or sold for immediate payment and delivery." Taking it further, Investopedia states that the spot price of a security, commodity or currency "perhaps has more importance in regard to the large derivatives markets."

That might sound complex, but InvestingAnswers simplifies the idea with an example, noting that on November 29, 2010, the spot price of gold was US$1,367.40 per ounce on the Comex. "That was the price at which one ounce of gold could be purchased at that particular moment in time," notes the publication.

So what does all that information mean in terms of zinc? Put simply, the zinc spot price is the current price that zinc is being bought and sold for. Investors looking for that information often turn to Kitco, which publishes a 24 hour zinc spot price chart, as well as 30 day, 60 day, six month, one year and five year zinc spot price charts. These charts are a great resource for those looking for current and historical information on the price of zinc and its spot market.

The London Metal Exchange (LME) is also a good source for the zinc spot price, but unlike Kitco, the LME publishes zinc spot price information in US dollars per tonne, not US dollars per pound. It's worth noting that some of the LME's zinc market details are only accessible to those who log in to the site.

What about zinc futures?

An understanding of the zinc spot price would be incomplete without knowledge of zinc futures. Why? As InvestingAnswers notes, the spot price of a security is important in and of itself, but "becomes an even more important concept when it's viewed through the eyes of the US$3 trillion derivatives market." As a side note, today's derivatives market is worth much more than that.

A derivative is a contract whose value is derived from the performance of an underlying entity. Examples of derivatives include forwards, options and, of course, futures, which let buyers lock in a price that they commit to buying an asset at in the future. That's desirable because it allows investors to reduce risk.

The key concept to understand is that the spot price of a security refers to its current price, while the futures price of a security refers to its price at a future date. The two are connected because spot prices, along with the risk-free rate and the contract's time to maturity, are used to set futures prices.

In terms of how that all relates to zinc, the Options Guide notes that investors interested in zinc can trade zinc futures on the LME under the contract code ZS in lots of 25 tonnes. The physical specifications for these lots call for zinc at a minimum of 99.995 percent purity conforming to BS EN 1179:2003.

As mentioned, futures trading allows investors to manage risk. Another article on the Options Guide explains how that works using the following chart:

chart explaining a zinc futures example

In the scenario displayed in the chart, the zinc price moved only 10 percent, yet the return on investment was 61 percent.

According to the publication, "This leverage was made possible by the relatively low margin (approximately 17 percent) required to control a large amount of zinc represented by each contract." Of course, leverage can work both ways, and it can be harmful for investors in adverse market conditions.

Investor takeaway

As can be seen, having some knowledge of the zinc spot price and zinc futures can be beneficial for investors interested in entering the zinc space. While stockpile supply concerns have been prevalent in the zinc market, some analysts believe that high annual benchmark treatment charges for miners will continue to remove higher-cost supply and support prices.

It will certainly be interesting to watch how the market develops and to see what profits can be made.


This is an updated version of an article first published by the Investing News Network in 2016.

Don't forget to follow us @INN_Resource for real-time news updates!

Securities Disclosure: I, Melissa Pistilli, hold no direct investment interest in any company mentioned in this article.

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