August 26, 2025: With less Kazakh material coming to market, the structural deficit only deepens

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This week on Uranium Spotlight Podcast: 

1. Uranium prices edge higher
2. Kazatomprom cuts deepens supply crunch
3. India and the uranium crunch
4. McLean Lake returns under Orano and Denison

Sponsored by Purepoint Uranium Group Inc. (TSXV: PTU | OTCQB: PTUUF)
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Transcript

It’s Tuesday, August 26th, 2025, and this week on Uranium Spotlight: Spot prices inch higher, Kazatomprom shocks with fresh 2026 production cuts, India accelerates its nuclear buildout amid looming supply shortages, and Orano and Denison restart McClean Lake with breakthrough SABRE mining technology.

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Uranium Prices Edge Higher

The uranium spot price closed last week at $73.92 per pound, up slightly from $72.80 the week before. That modest gain came on light volumes—only two transactions were reported for the entire week. SPUT picked up a 50,000-pound prompt delivery lot on Tuesday, and then on Friday we saw a forward deal at $76.25 per pound for early 2026 delivery. That was enough to nudge the weekly average higher, but overall activity has been sporadic, reflecting the typical slowdown in summer trading.

What did stir the market was Kazatomprom’s announcement of changes to its 2026 production levels. Even though details are still being digested, bids briefly moved higher on Friday, particularly for 2026 deliveries, before softening again by the end of the day. It was a reminder that any supply adjustments from the world’s largest producer can quickly ripple across both spot and forward prices.

Looking at the broader picture, the Ux long-term price remains steady at $80 per pound. That’s the price utilities benchmark when signing multi-year contracts, and while only one active term RFP is on the books right now, several more are expected this fall. Recent awards suggest sellers are competing not just on price but also on contract structure—flexible quantities, escalators, and floor/ceiling ranges—some floors dipping as low as the $50s, while ceilings remain as high as $140.

For investors in uranium equities, the key takeaway is that despite the quiet summer volumes, prices continue to grind higher. The spot market is firming, the long-term price is holding, and utility activity is poised to return as we head into the WNA Symposium in London.

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Kazatomprom Cuts Deepen Supply Crunch

Kazatomprom has surprised the market again. Instead of ramping up output through its KATCO joint venture with Orano, the world’s largest producer now says it will cut production by roughly 8 million pounds in 2026. That’s about 5% of global supply.

Originally, Kazatomprom was expected to deliver 85 million pounds in 2026, but that forecast has been trimmed to 77 million. For 2025, guidance remains unchanged at 55 to 57 million pounds.

This shift matters because the uranium market has already been undersupplied for years. With less Kazakh material coming to market, the structural deficit only deepens. Kazatomprom itself pointed out that while the spot price has been volatile, long-term contract prices have held steady around $80 per pound for months, reflecting strong fundamentals. They also suggested that some of the spot price weakness may be linked to tariff war speculation rather than changes in real demand.

At the same time, Kazakhstan is preparing to build three nuclear power plants at home—with Rosatom constructing the first two and China National Nuclear Corporation building the third. Talks are also underway for a possible fourth. That future domestic demand, combined with heavy long-term contract commitments to Russia and China, means less Kazakh uranium will be available to the West.

This leaves Canada and Australia as the only truly reliable suppliers for Western utilities. But together, their output still falls well short of what Kazakhstan alone can produce. Other producing countries—Namibia, Niger, Uzbekistan, and of course Russia—are increasingly aligned with Moscow or Beijing. Add China itself into the mix, and nearly 98% of global production sits outside firm Western alignment.

For investors, the takeaway is simple: Kazatomprom’s cut reinforces the structural supply shortfall and highlights how geopolitical alignment, not just geology, defines uranium supply. With Western utilities squeezed between limited friendly supply and strong competition from Russia and China, the long-term investment case for uranium remains as compelling as ever.

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India and the Uranium Crunch

India is moving quickly to expand its nuclear fleet. The country’s largest power utility, NTPC—which today operates mostly coal plants—is now building four new reactors. At the same time, Russia’s Rosatom has confirmed it’s in talks to add as many as six more.

On the fuel side, Hindustan Zinc—India’s largest zinc producer—announced plans to enter uranium mining. What isn’t clear yet is whether they’ll focus on India’s limited domestic resources or invest abroad where uranium supply is stronger.

The bigger story is that India has been overhauling its laws to support this push. Recent reforms now allow private investment in both reactors and uranium mining, and liability rules have been eased to encourage foreign participation. These steps lay the groundwork for scaling nuclear power, but questions remain: can India move quickly enough to decarbonize its economy and avoid the uranium supply crunch expected later this decade?

The urgency is real. India faces surging power demand, climate-driven weather shocks, and rising geopolitical risks in uranium supply chains. And, as with all large projects—whether mines or reactors—financing remains a major challenge. Still, the political will is there. The CEO of Tata, one of India’s most powerful corporations, put it bluntly this week: “Nuclear can’t just be a fashion statement—it needs to replace coal as a source of affordable power.”

The ambition is clear: India wants to grow from its current 8 gigawatts of nuclear capacity—spread across 25 reactors—to 100 gigawatts and nearly 100 reactors by 2047. But building that scale will take decades. Even with fast-tracking, new uranium mines typically require 12–15 years to come online. With many analysts warning of a global uranium shortfall by 2026 or 2027—especially given fresh guidance from Kazatomprom—India will be entering the market as a buyer just as supply tightens.

For investors, the takeaway is that India’s nuclear buildout adds another layer of demand in a market already facing structural shortages. Whether through direct uranium purchases, partnerships with miners, or foreign investments in supply, India is positioning itself as a significant long-term driver of uranium demand. For uranium equities, that means additional support for higher prices and stronger valuations as this demand story unfolds.

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McClean Lake Returns Under Orano and Denison

The McClean Lake mine in northern Saskatchewan is back in production for the first time since 2008, when operations were suspended due to collapsing uranium prices. At that time, mining wasn’t viable, and by 2010 the mill also halted briefly because there wasn’t enough ore to process.

Fast forward to today—what’s driving the restart isn’t just stronger uranium markets, but a breakthrough in mining technology. Orano and Denison have launched full-scale production using their patented SABRE method, or Surface Access Borehole Resource Extraction. After years of testing, SABRE proved it can economically recover high-grade ore from smaller or deeper deposits that conventional methods couldn’t reach. It’s a cleaner, more surgical approach that reduces environmental disturbance and cost.

For 2025, the McClean Lake joint venture is targeting about 800,000 pounds of U₃O₈, or 308 tonnes of uranium, with another 3 million pounds projected from McClean North and Caribou between 2026 and 2030. While those numbers are modest compared to the world’s largest projects, they matter. SABRE opens the door to unlocking high-grade satellite deposits across the Athabasca Basin, potentially extending mine lives and feeding mills already in place.

For investors, this marks both a symbolic and practical turning point. Symbolic, because a project sidelined by low prices for nearly two decades is now worth restarting. Practical, because SABRE could create a new pipeline of economically recoverable pounds in a market already defined by supply shortfalls. It’s another sign that uranium’s fundamentals remain tight—and the industry is innovating to meet that demand.