Free Weekly Email 2.18.25

US, European energy companies in jeopardy amid uranium supply 'crunch'

The uranium "supply crunch" comes as Kazakhstan, the largest exporter of Uranium worldwide, ups its sales of uranium to China and Russia.

The threat of future shortages comes as Kazakhstan, the world’s biggest producer of the metal used to power nuclear reactors, sells more to Russia and China and less to the US and Europe.

“Russian and Chinese players have been very keen to secure access to resources in central Asia and Africa, creating a very aggressive competitive environment,” said Benjamin Godwin at Prism Strategic Intelligence.

However, despite there being a surplus of uranium, executives say it is slowly being depleted. “We’re on a depletion curve that I don’t think many customers have realized,” said Cory Kos, vice president of investor relations at Cameco, one of the world’s largest publicly traded uranium producers and the biggest western supplier based in Canada.

“As an industry, we’re living off borrowed time... inventory that’s running out has kept the supply chain going," one former executive added.

I have been writing about this for a couple of years. The underinvestment will now manifest itself in shortages, and the US and EU will be most affected.

There is plenty of uranium in the earth’s crust. The problem is the time and expense needed to get it out and process it into usable reactor fuel.

The Trump administration understands this, but fixing it will still be a herculean effort that will cost billions and take years. This is why uranium is such a great opportunity.

Louis-Vincent Gave: Making sense of the latest Chinese stimulus

Have western investors got the chinese markets all wrong? Emerging markets have been the focus of Louis-Vincent Gave’s career, where he, in addition to being an author, also serves as a founding partner and CEO of the company Gavekal.

Ford Loses Another $5.1B On EVs

Ford’s massive losses on its electric vehicles have become commonplace. But the latest numbers are still gobsmacking. This week, Ford Motor Company reported that it lost $5.1 billion on its EV business in 2024. During the fourth quarter, it incurred $1.4 billion in operating losses on its EV segment. That was a slightly better result than the fourth quarter of 2023, when the company lost $1.6 billion on EVs. The company also reported that its volume and revenue dropped due to “pricing pressure and competitive market dynamics.”

Kelley Blue Book reported that Ford’s EV sales were 30,176 for the fourth quarter and 97,865 for the entire year. Therefore, Ford lost $46,394 for each EV it sold in the fourth quarter and $52,113 for each EV it sold in 2024.

Overall, the company still made money for the year. Nevertheless, as many other automakers have already done, it is likely time for Ford to pivot away from EVs.

Precious Metals: The Return of the West

In the tumult of the global gold market, the past four years have unfolded as a clash of opposing forces. On one side, the steady drumbeat of rising real interest rates beginning in early 2021 prompted Western investors to liquidate gold holdings with an enthusiasm as familiar as it is predictable. Conversely, an equally determined cadre of global central banks emerged as voracious buyers, amassing reserves with a resolve that seemed to shrug off conventional market pressures.

Central bank buying surged to unprecedented levels in 2022, ultimately overwhelming Western selling. The result was a sharp reversal: gold prices began a remarkable ascent, climbing steadily through 2023 as central banks continued their buying spree. By the middle of 2024, the gold price had vaulted over 70% above its 2022 lows, an extraordinary feat given the headwinds.

However, the market appears poised on the brink of a fundamental transformation. Central banks, though still buyers, have eased back from the feverish pace of the past two years. Meanwhile, the tide of Western investor sentiment, long bearish, seems to be turning. Declining real interest rates are enticing these erstwhile sellers to reverse course.

I am, of course, bullish on gold and gold stocks. Gold may be slightly ahead of itself currently. I also like silver and platinum. Platinum is just plain cheap relative to gold. It may be ready to break higher.

Is platinum preparing to break to the upside?

That is it for this week.

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Regards,

John Polomny