[Music] [Music] I'm Charlotte McLoud with investing news.com and here today with me is Gwen Preston of resource Maven thank you so much for joining me great to see you great to see you as well really good to be catching up here in person again at VC our last conversation was back in November and we covered a lot of gold and uranium at that conference so we're going to go in those directions today first I I was hoping we could like take a quick look back at 2023 and maybe maybe look at some of your hopefully investing


highlights but could could be low lights as well I know it was a tough year for the juniors so yeah 2023 was an interesting year we endered the year wanting to be optimistic but we were still in that intense rate hike cycle um there was not the thought that we that there wasn't visibil ility to the end of that yet and that that's going to keep gold disinteresting right gold performed admirably over the last several years despite all of those raid hikes but admirable meant that it stayed really


sideways in a boring trading range for um for almost three years um and so that meant that nobody was interested in Gold stocks so the only thing the only things that were exciting and that worked last year were discoveries and that's fine um because whenever you are waiting for a Metals Market to turn into what you think it's going to turn into an exciting moment um discoveries are the thing that you can play they're the hardest stocks to pick the prediscovery Explorers but when they work man did


they ever work so there were some really exciting discoveries like Founders medals was a really exciting discovery that one went through the roof um lavra gold did really well um snow line with its uh it wasn't a new discovery this year but they Amplified what they found and so this and the market responded to that um and so it's always fun and uh it's always fun to see stocks respond the mark Market responding to discoveries because it validates that people do pay attention even if we're


all sort of waiting for the bigger Market to uh for generalist investors to get interested because the bigger picture makes sense of course on the uranium side in the second half of the year we did get some lovely excitement in the uranium side of things so so yeah 2023 was a mixed year some some successes certainly some others that were very boring or disappointing um because that was just the nature of the year yeah and you mentioning the Discovery Place that was a point I wanted to follow up on because you did


highlight that last time we spoke this is where you were seeing success I wondered if in 2024 we will see maybe a broader range of types of companies that will work yeah so it all depends when um gold actually makes its move higher so my my premise for Metals broadly is that the metals that require investors to um be positioning for Global growth are probably not going to move yet in 2024 so silver and copper are the two examples that I pull out out they are very bullish fundamental setups but both


markets are sort of working through the SLO in their supply think of all the warehouses in China that were full of copper that was leveraged to for the housing market right um we're still working through that excess same with silver we're still working through the excess there was big deficits in silver for the last few years in terms of production versus demand and it was fed by investor dording so we're working through the excess so there we're not at a supply crunch in those markets yet and


I don't think we're going to get to like woohoo Global growth the kind of sentiment that pulls people into those Metals so I think it's going to be discoveries only that will work in those growth metal like not that the metals markets are growing but the me metals that depend on growth um gold I see working you know from the middle of the year on I think that the next move up in gold is going to require the rate cut we've had the expectation of the rate cut built into the price and that's why


we've gone up to new highs um but we're still really in that sideways Trend right we're not we haven't broken through it I think actually breaking through that will require the rate cut which is a very significant thing the reason that Gold's been so range bound is because we've been in this rate hike environment and that's inversely related to gold and so once we actually get to Cuts I think gold has a very good chance of breaking up through because the fundamental support that kept gold


strong despite all those rate hikes which was Central Bank buying that continues unabated they are still stockpiling gold because dollarization and de globalization and goodness knows what's going to happen next we better have some gold the Central Bank buying continues and now we have rate Cuts so I think it will happen I don't think it's going to happen tomorrow but I think it will happen this year and so assuming that that happens then yeah this when gold breaks up through and starts to


attract some generalist interest the stocks that will move first and most will be producers high margin um or high-grade producers or producers just of scale because that's where the big money goes um and the big uh Advanced assets so the the mines that are either under construction reasonably close to production uh to construction um there's not very many on that list so those are the stocks that I think will move first when gold breaks up through that range okay yeah interesting so gold needs the rate cut


I'm reading that with capital letters in my head or it's how I'm hearing it so it needs that rate cut we don't necessarily need to pinpoint when it's going to happen I guess my question would be you know gold has other things working in favor right now the Central Bank buying geopolitical turmoil so once we remove the the high rates is is there anything else standing in Gold's way or is that that's the one you know I don't think there's anything else standing in Gold's


way the the thing that's changed overall in the gold sector in the mining sector over the last call it 15 years is just um investor interest that used to go to this space I think has become a bit more fragmented and what I mean is that Metals used to be um did they didn't have a choke hold on sort of high leverage like speculative returns but they were an important the medals the mining Market was an important player for investors that were looking for like high risk High return right when a


Metals bull market was going investors knew that that was the place that you could make a lot of money if you were willing to pay attention and and put your money in um what and ride the horse as long as it ran um in the last 10 years 15 years we've had that that the speculative of options in the market have proliferated so you just look back we've had cannabis we've had you know nfts Meme stocks we've had so many cryptos we've had so many options abound in the market that now I think there's


just a bit of a splintering of interest that said if gold goes I think people will remember so it it's maybe created a little bit more of a a hurdle to get over because you're going to have to stand up and say remember gold it's back and people will and then and then once that's quite apparent then I think the interest will return okay that actually helps me because I was thinking to myself about that because we do hear about the fragmentation of investor interest and I was in my head I was


thinking well but haven't we always had distractions like you know so that kind of helps me so there actually is more going on now that can distract people I think so especially in the speculative Arena like I think the Explorers downstairs at the conference would be AC are especially aware of this like in can if you wanted to have you know put your money into a risky stock that had the potential to give you 10 bagger then mining 15 years ago like exploration stocks were what you bought they were


the thing is that is that a true statement anymore no it's not there's a lot of things out there do you do AI today do you do like what's the next drug that might be legalized do you right what is the next thing so there's just a that that um Arena has become more fragmented so I think that's really been a a challenge for the exploration stocks if and when we get into another Metals bull market and the stocks start responding way more to Discovery than they even have been in this quiet market then


investors will come to this Market just like they went to monkey nfts or or AI or whatever the Robin Hood thing was right so okay and one more question on the precious Meadows side so I noticed you put silver alongside copper when you're talking about them so I have to comment on that so for you of course we know that silver has its precious side it's got its industrial side but do you see it then taking more cues right now from the industrial angle I do for sure um I think partly because of the sort of


fragmentation of interest um in of investor interest but also I mean silver is a really industrial market and all of the growth levers in the silver market are our increases in industrial demand primarily from solar um and I think that is in because that's where the demand growth is is coming from and it's it's very significant I think that's changing the perception of the market it certainly has for me like I used to think of it as more of an investment market and there's certainly lots of


people out there who will Who completely believe that it is just as much an investment as it is an industrial Market I get that um but I just personally see it more as an industrial Market um if and when gold you know starts to go crazy then maybe the investor Ango will come back more strongly but but it's going to follow it's not going to lead okay okay we'll leave precious metals there and move over to your which is very exciting right now so when we spoke last it was the commodity I think


that you were the most excited about and it looks like for good reason certainly we've seen the price get to Triple digits since then and the fundamentals seem to get better and better every day but for me I'm I'm getting a little bit worried about the price I feel like it's been moving quite quickly so what are your thoughts are we are we due for not not a bad correction but maybe a healthy correction so okay there's any price that moves 100 moves 50% or doubles sorry that doubles in eight months sure


I mean there there's absolutely risk of reason for um except that in uranium um it is moving because utilities are looking for Uranium because they because they're sort of herd animals and they kep waiting for each other to go first and so they didn't buy it when it was available and the price was lower would have been smart but anyways they didn't um and now they need to buy it and it's now a sell's market it was for for 15 years it was a buyer's market they could set the price they could say I'm only


going to buy it for you if you sell it to me for 15 bucks now the sellers are like I'm only going to sell it to you for 106 and they don't the buyers don't have a choice but to say yes because it has become so tight they're just isn't Supply I mean this is a thing that started back in 2016 we sosed through all of that excess Supply and it just isn't there anymore so I think there probably still are a few little pools of extra of of uranium that has been tucked away and that will come out so there's


you know hedge funds that may be bought eight months ago and and now they've seen the price double and they're not commodity experts and they will at some point be like wow this is cool and they will you know some some hundreds of thousands of pounds will become available on the market and the price will step back I do think that that will happen over the next year and fair enough that's the game that hedge fund was playing they should catalyze their gain or they should crystallize their


gains that's that's what they should do but the the volumes there are actually really small the amount that is going to come out the really big funds that stockpiled uranium like sprot sprot doesn't actually have a way to sell uranium people are always like well what if sprot starts selling uranium sprout actually can't sell uranium the way their fund is structured they can't sell it so the the supply really isn't there so even though there may be some a few little spurts of Supply that come in as


these much much much smaller and less um focused investment groups maybe sell into the market a little bit um there just isn't Supply and then you look at the East West divide this is the other big factor that's ahead so the US House has already passed the ban on Russian uranium and that ban on Russian uranium would give exemptions if a utility is like I really need uranium but I can't get it in domestically or from friendly countries then they would literally get a permission slip to go and buy it


through the port of St Petersburg that bill is now in front of the Senate it's going to get past very like 90% chance it's going to get it's only being held up because of a an attached thing that people are fighting over in a very classically American political way if that happens what do you think the chances are that Putin says screw you and just cuts it off before like cuts it off completely with no permission slips for exemptions right then all of a sudden you just can't get any of the


uranium that comes out of the port of St Petersburg that is all of kazak uranium and Russia's uranium right and so America consumes 48 million pounds of uranium a year about half of that currently gets sourced from um the tiny tiny tiny bit domestically like 200,000 PBS it's nothing um and then Canada and Australia can produce about half of it that's great the other half comes from Russia and all of a sudden it's not allowed to come from Russia anymore so if we get that if if Putin says screw


you I'm G to cut off Russian uranium before then and and I get why they're passing this bill but they're kind of cutting off their nose to spite their face um then you know you could easily see a $40 jump in the price of uranium like you could see it just go overnight to1 $40 taking that political question to the side because we don't know the timing of that and the certainty I mean I think it's quite likely but there's doesn't Supply so I don't think the price is going to despite a few little


setbacks that maybe create some create a trading range for a little while here to stabilize this huge price run that we've seen I mean this price has I think will still go higher I'm very confident that this price is going to end 2024 higher than the insane price that it began the year at because it's not actually insane it's a valid representation of the lack of this essential commodity that utilities need yeah okay that was a really great sum up of the uranium market so on the


notice Supply the kind of bit of frequent or recent news that I want to bring up as well is what's going on with kazanan prom I think everybody was quite excited and I will try to phrase this carefully so I get it right so they've released the news that they might in 2024 and 2025 fall short of production I think we're still waiting to hear if that's for sure but it's created a lot of excitement so for you how are you interpreting that cuz Adam prom will not meet guidance in 2024 and 2025 they said


it in a careful Market way um but anybody who pays attention to uranium and knows kazad and prom well I mean I I can't say that I am that person but I know people who used to work in kazad and prom and so know the company quite intimately uh they can't get the sulfuric acid that they need and more importantly because that might be a problem that could be solved with enough political will um more importantly they have not been putting in enough money to develop Wells these ISR production


fields that they have and they have re they're developing some really big new ISR production Fields the most important thing that you need to do is really stay ahead of your drilling you need to have drill rigs as far as the eye can see drilling the injection Wells the recovery Wells you need to just just go for it and that's expensive that's why you know oncers you just signed a deal with boss energy to sell 30% of their alamesa because they needed $70 million so that they could push alamesa so that


it really can ramp up because it takes a lot of drilling to do that that's what Kazam prom has not done sufficiently it's a bit weird sure you'd think they should have you think they would have it's kind of like utilities why didn't you buy the uranium when it was cheap they just didn't why didn't because Adam prom drill the well drill the wells they just didn't they can't make that up so they will not meet guidance in 2024 we will learn those numbers by the end of


the month when they release their financials or their Outlook and then we'll learn how much they expect to miss buy people that I talk to don't think they'll even meet their numbers in 2025 and Kaz Adam prom produces 40% of the world's uranium 40% so when their Cuts back in 2016 2017 helped write the market when it was drowning their return to full production was supposed to help stabilize the market now that it's tight but now their stabilizing help has been pushed out by one or two years so it


amplifies the situation right and I'm I you can tell me what you think but I'm thinking what we can maybe learn from this is other ramp hubs that are happening also might face issues so I think the thing there is it just takes between permitting and all the wellfield development that you need all this drilling that you need to do it just even for an ISR mine it just isn't that fast to get going think about American there's there's sort of 22 um processed plants or Mills so hard rock or ISR


plants in America that could be restarted so that's helpful for sure but you got to get the stuff for those plants to actually work and even when it's just a well field it's a long process and it's an expensive process to permit it and to test the hydrogeology and to get it all going and whatnot so that is why even though America used to produce 40 million pounds of uranium a year or whatever before the Cold War and now they went to nothing it's going to take a long time to ramp that production


back up and that's sort of that's the real reason why this Market should have some staying power and some high price staying power because there's no quick solution it just doesn't exist you need time and capital investment to get these mines going and that has been completely absent for a decade okay and I almost I almost hesitate to ask this question because I feel like it changes every day but have we hit on the main things the main factors in Supply we haven't even touched demand that investors should be


watching when it comes to uranium I think so I think the big thing is that the supply is very very tight there's very very few and very small pools of Supply that could come into the market talk to me four years ago and I was like I like uranium but I don't know how many secret pools of uranium there are that are just going to come out as soon as the and that's what kept the price just sort of doing this for so long there was all these it would gain a bit and then people would be like Oh yay now I can


dump my uranium and that happened a lot but now there's very little Uranium on the sidelines so Supply is super tight the East West divide is very significant and will only amplify the supply tightness you take a market that didn't have enough then you divide it in half and the west side has is even worse off than the east side so that's where we sit is on the side that has less than less than enough the demand side is what it's always been it's growing um you know it takes a long time to build


reactors the the variable on the supp on the demand side is small modular reactors and this is one that where we there's no clarity as yet the thing small modular reactors can be a great part of the solution for Bas load power for all kinds of things for green energy for isolated communities for isolated projects they can make a lot of sense the challenge for small modular reactors is that they're currently beholden to exactly the same permitting process as a massive power plant and guess what those


are very very very Uber cautious um permit permits so it's very hard to get a small modular reactor we haven't had one yet because the permitting process is I'm comfortable saying the permitting process is way over the top for what it is so there's been a lot of political will in America towards supporting nuclear our n the nuclear future so the Strategic stockpile support for Uranium producers now they're now they're supporting your the buildout of nuclear fuel processing


capacity which they also need to cuz guess what Russia also controls that but anyway um I think if America came out and their one of their next steps in supporting the future of nuclear power was a decision to reframe permitting for small modular reactors making it a reasonable time frame with reasonable hurdles then the demand then the the supply Gap starting about five years out would ramp because these things that also the way that they're loaded you need to load more fuel like you sort of


load 10 years of fuel at a time so if you think you could actually get a small modular reactor up and going in the next 5 years you're going to need to buy 10 years worth of fuel so if that happens that's the thing that could increase the supply Gap okay very interesting and all right I think this is maybe the most important question so investors who are in uranium or maybe they're not in yet but they want to come in clearly there's still a lot of opportunity to come but how how do people smartly play this and


make sure that they can maximize their gains and and not get caught in anything too much exuberance fair enough good question we all are very anybody who played the last year in your Market is intimately familiar with how much of a spike that was right oh my gosh the price just keeps going up and now it's down again right up to $170 a pound and then back down again in pretty short order um to be clear that market had way weaker Supply demand fundamentals than this Market this Market is a is a robust


animal compared to that one but still um I think with any big Metals bull market it's just really important to take some profits along the way because there will be e and flows in this like and people will get nervous and and the market will get nervous and it will come down and so I think you need to take some profit along the way um when it's handed to you I think the safest kinds of stocks to play are growing us production I mean these are the biggies they've already moved a lot this is the ueec This Is The


Encore energies the Energy Fuels growing us production um they're really safe bets they're the ones that are going to get the most benefit from the East West divide especially if the Russian uranium sanction happens they will really really go um so if you buy like Encore Energy today and then the Russian sanction thing happens and Encore goes up 50 70% it's very likely that that could happen I mean sell some into that this is just see if you can reduce your cost base a bunch so then you're just not at risk of


losing what you put in originally if this thing comes down again to be clear I don't think this thing is going to come down the way that the price came down in the last Market I really think this thing is going to stay high for long because that's just the setup and there's no easy answer um but in any Market you should take profits along the way okay I think that that makes a lot of sense and I think in our previous conversation or maybe in in some of your writing you've mentioned gold and


uranium as sectors that are going to do well regardless of whether we go into a recession or not we haven't even talked about that question um which we can but what I was wondering is is there any other industry that you would add to gold and uranium or is it is that where you're looking that's I mean if you want to say going to do well this year regardless of what else happens those are the two so uranium has this incredible Market that's understood it's a supply demand situation its utilities


utilities don't care whether GDP is growing or not they just can't turn off their power plants so uranium is doing its own thing gold should do well with rate cuts and to be honest we'll get more of them if we get a recession how that will play out in the equities is always the question and whether there will be a trough before they start going again um but the gold price should do well um so yeah those are the two that I would say are Recession Proof is a very strong statement but yeah yeah are much at much


lower risk of impact from a recession yeah I think that's that is a much fairer way to say it very very diplomatic all right I wondered if you had any final thoughts or words of advice that you would leave investors with because it seems like it's going to be a pretty interesting year I think it's prudent to if you're a Metals investor it's really important to always remember that each metal has its own set of influences right and so um if you like copper because we're not going to


have enough copper in 5 years that's really great I love copper because we're not the world is going to be short of copper in 5 years but that doesn't mean that I'm buying copper leverage plays today because I don't think copper is going to move this year so I think it's just really important to have your outlooks for each major medal with timeline sort of wrapped around those because that can help you understand which stocks you should have exposure to Now versus which ones you think you


should should be ready to have exposure to when the world starts thinking about growth or we start realizing that we've actually run out of copper whatever it is right so when we get to the point then you're ready to go but there's no point laying yourself out and then waiting I think it's important to understand that Metals move on timelines with catalysts and they're each their own Beast so uranium is happening now gold will probably happen this year copper and silver might not happen until


probably next year and then that helps you understand how to structure your portfolio in a way that's more um easier to sleep with at night basically okay I think that that's a great place to wrap it up on thank you so much for going over gold uranium we should probably come back and do a full uranium conversation at some point absolutely that would be great but this is really good thank you so much thank you okay and once again I'm Charlotte McLoud with investing news.com and this Isen Preston


with resource Maven thank you for watching if you like this video make sure you subscribe to our Channel we'd also love to hear your thoughts so leave us a comment below we'll see you next [Music] time