During the month of August, the Australian uranium mining company Paladin Energy released some news that sent a much-welcome shock wave through the industry: Not only had it entered into an agreement to supply about 14 million pounds of uranium to a major utility, but it would be receiving $200 million as a pre-payment-even though the actual delivery of uranium would not begin until the year 2019.

The confidence in the marketplace reflected by the Paladin deal represents major news for an industry whose product is thought by several analysts to be significantly undervalued. In the wake of the Paladin announcement, for example, both Credit Suisse and RBC agreed that uranium prices could potentially rise as high as $80 to $90 per pound in a healthy market-up from $48 per pound as of mid-September 2012.

The relatively low uranium prices we have witnessed in 2012 have, in fact, been the cause of some developmental holdups within the industry. For example, the uranium producer Cameco has delayed its Kintyre mining project, located in the East Pilbara region of Western Australia, due to depressed market conditions; meanwhile, another Australian producer, BHP Billiton, has delayed for two years a proposed $20 billion expansion of its Olympic Dam mine, sited about 340 miles northwest of Adelaide, for the same reason.

The Paladin deal, however, suggests that these lean times for uranium producers may actually be coming to an end. Another encouraging piece of evidence supporting this view is the news that the United Arab Emirates has recently awarded $3 billion to six international companies-Rio Tinto, Areva SA, Uranium One, Tenex, ConverDyn and Urenco Ltd.-to supply fuel for the country’s four planned nuclear reactors.

It should also come as little surprise to observers that the Paladin deal has been received as highly encouraging news by executives working within the uranium industry. “Uranium mining is the only business I can think of, and definitely the only mining sector, in which it is possible to get paid so much up front and have seven years to deliver production,” says Amir Adnani, CEO of Uranium Energy Corp.

Uranium Energy became a uranium producer in November 2010, and Adnani is bullish on the industry’s future. As of April 30, 2012, Uranium Energy has produced 270,000 pounds and in Fiscal 2012 sold 210,000 pounds generating revenues of nearly $14 million. Post-Fukushima the Company has made six acquisitions growing its total resources from 35 million pounds to over 80 million pounds

If the utility paying Paladin believes there is a big uranium deficit looming-as seems evident from the terms of the deal-this represents good news for uranium producers, as it reveals the current spot price valuation to be unreasonably low. If a disparity between supply and demand becomes more evident in coming years, it is sensible to predict that prices will rise, and producers might be making significant deals comparable in scale to the one secured by Paladin.

Writing last April on the well-known financial blog Seeking Alpha, the investment writer Tony Daltorio observed, “The real impact in the uranium market will probably be seen in five years when demand for electricity keeps heating up in places like China and supplies from prospective uranium projects in Africa and elsewhere do not come to fruition. That’s when it will pay to be an established uranium producing company.” With regard to future demand for uranium, the key might very well be the emerging markets, such as China, where demand for electricity is soaring; 65 nuclear reactors remain under construction around the globe, with 26 of them in China. However, news such as that announced by Paladin suggests that the time frame for a resurgent market might actually be less than half a decade away.

A post-Fukushima renaissance in the uranium market has not yet arrived in full force, but the Paladin deal may be among the first signs that the tide is finally starting to turn.

Sebastian Thaler is a freelance science and technology writer based in New York City.