Yellowcake is milled uranium oxide, known to chemists as U3O8. It goes through a milling and chemical process to remove minerals and leave only uranium. At the end of that process what’s left is called yellowcake.
Yellowcake is far from enriched uranium, but it is a first step. The yellow powder, which also can have a grayish or reddish tint, must be converted into uranium hexafluoride, a chemical compound that has one atom of uranium and six atoms of fluorine. It can be a gas, liquid or solid. Once it is a gas, it easily can be enriched and used in weapons.
In recent years, yellowcake inventory and its possible international circulation between rogue countries and terrorist groups has been the focus of a great deal of controversy and concern. Yellowcake was at the center of the Valerie Plame case that focused attention on classified information leaks to the press and saw a New York Times journalist spend time in jail to protect her sources.