Uranium: Positioned for the biggest rally on record

A guest post from Ocean Wall's Nick Lawson diving in to the currect opportunity in Uranium.

In October 2006, uranium went from $19/lb to $143/lb in seven months. That move was so violent it rewired how I thought about commodity markets entirely. That convexity, that parabolic acceleration, is not an accident or an anomaly. It is the direct expression of uranium’s inelasticity of demand. Reactors cannot simply switch fuels, utilities cannot defer fuel purchases indefinitely, and once a supply deficit opens, the market has no choice but to bid aggressively until demand destruction forces equilibrium.

There is no substitute, no workaround, no patience. Uranium either arrives or it does not, and when it does not, prices do not rise gently. They spike.

That is precisely what we are seeing now, and precisely why the dislocation in the sector matters so much. The term structure is already climbing, the Saudi deal is locked, the DOE loans are confirmed, and supply is visibly breaking across half a dozen major assets. Every piece of the 2006 setup is in place again. Demand is inelastic, supply is constrained, and the market has only just begun to price it in.