Bhandari also offers his take on the US-China trade war and how it presents a win-win situation, and speaks about speculating in commodities.
Speaking with the Investing News Network at this year’s Vancouver Resource Investment Conference, financial analyst Jayant Bhandari made a case for avoiding uranium projects, saying that low demand and the rise of renewable energy mean the commodity’s future is grim.
In a wide-ranging interview, he also offered his take on US-China trade war and how it presents a win-win for global markets, and shared his opinion on investors speculating in the commodities market. Spoiler: he says don’t do it — but back to uranium.
“Most uranium-mining projects do not make sense unless uranium prices go up by 100 or 200 percent,” said Bhandari.
“Now for these companies to break even, if [the] uranium price has to go up that much, I am much, much better off investing in uranium physical because by the time I will have made 200 percent of my profit these companies will still only be breaking even.”
He added that even then, he wouldn’t want to speculate in uranium “because the long-term pricing of uranium has stayed stagnant for the last 1.5 years.”
Clearly not a fan of the energy resource, he explained that uranium-based energy production is falling, while alternative energy supplies are becoming cheaper — like wind and solar.
“Electricity based on sun energy and wind energy has declined drastically in terms of cost … [while] uranium and coal-based electricity-generating plants are among the most expensive electricity-generating plants today.”
The end result, said Bhandari, is that there is no case to invest in the commodity, pointing out that uranium lacks any green credentials as well.
“[‘Green credentials’ are] camouflage for a lot of investors’ greed,” said Bhandari.
“They are greedy about making money but they want to show their intentions as being pro-green. The reality is solar and wind energy is even more green than uranium-based energy is. So I see no reason why you should be specifically going for uranium energy just because it is so-called green — it is indeed greener than coal-based energy, but wind and particularly sun-based energy is much greener.”
Bhandari had no advice for investors that set out to develop a clean and green portfolio, saying “you can either try to make money, or try to think green.”
Leave it to the markets, he said.
“Capitalism and economics takes care of making sure that the best technology that is best for the society comes into play at the least possible cost. The least possible cost is the most green way of developing an economy.”
Don’t forget to follow us @INN_Resource for real-time updates!
Securities Disclosure: I, Scott Tibballs 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 contributed article. 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.