Magazine article African Business

Marikana Ripples Continue

Magazine article African Business

Marikana Ripples Continue

Article excerpt

PLATINUM PRICES ROSE 8% OVER THE YEAR from $1,415 per OZ to $1,533 per OZ but were volatile, with a trading range of $1,388-$1,727 per oz. However, the industry was rocked by the wildcat strike at Marikana, which resulted in the tragic deaths of 34 mine workers.

Some 80% of platinum production is based in South Africa. With rising labour and energy costs, and the labour unrest that disrupted production, output is likely to be lower than in 2012 and may well continue to fall. Limited demand for diesel catalytic converters in Europe and the increasing substitution of palladium (also used in petrol catalytic converters) for platinum are not helping the sector.

In fact, palladium was the best performing metal last quarter, rising 12.5%. The market will see an estimated supply deficit of 511,000 oz this year. This has led some to suggest record prices are ahead. Prices had been weighed down by sales of stocks by Russia, which have fallen to 200,000 oz this year from over a million in 2010. …

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