Uranium market watchers have been waiting for a turnaround for years, but Nick Hodge of the Outsider Club says there’s still one ingredient missing.
“(Utilities buying) is the only thing we’re waiting for — you can’t sell uranium unless the utilities are buying that,” he said at the Vancouver Resource Investment Conference.
“And we need utilities to buy uranium for the price to go up because, well, you can’t sell uranium at US$25 a pound — where it’s currently at — because nobody would make any money.”
In Hodge’s opinion, 2023 is the earliest that utilities are likely to return to the market. “We’re at least in the right decade now,” he quipped.
Speaking about other factors causing uncertainty in the uranium space, he emphasized that no formal guidance has yet been given on Section 232 in the US, and said that tensions between the US and Iran are disrupting the Joint Comprehensive Plan of Action.
“If we were beginning to make any progress globally in the uranium sector … an event like this — one, it gives pause to business leaders and deal makers, so things don’t happen because there’s uncertainty. And the other thing it does is it puts the negative taste of uranium back in the public’s mouth, and that’s not good for the sector either,” he said.
Aside from uranium, Hodge also spoke about gold, which he is more optimistic about in the short term.
“All the factors are there — people like me have talked about them for years at this conference. Global debt, sovereign debt, negative interest rates, (the) Fed printing money, a 10 year long bull market in broad-based equities,” he commented.
“All those things still exist and have laid the foundation, if you will, for this gold bull market. (But) I think now it’s time to look past that — yes, negative rates matter, yes debts matter. But right now the price of gold is what matters.”
Watch the interview above for more from Hodge on uranium and gold. You can also click here to see our full VRIC playlist on YouTube.
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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.
