"That material -- which is not the same as the material known as 'yellow cake' (uranium freshly mined from the ground that cannot be used for nuclear weapons) -- was not smuggled," said a statement sent to United Press International.
My BS detector is going off. Uranium Dioxide is the first of several intermediate steps in processing Uranium from yellowcake or uranium ore. It's referred to as a reduction form since it will extract potent uranium metal from bulky ore. Still not suitable for weapons, but easier to transport.
I am not a physicist or chemist, but have been to United Nuclear's mine at Atlantic City.
Here's a link that will curl your hair
This link details the process to convert Uranium Dioxide to UF6 which can be enriched.
To bad our lame media won't do this research.