JOHANNESBURG (miningweekly.com) – The latest fall of the platinum price is threatening to become the last straw that broke the camel’s back for some deep labour-intensive platinum group metals (PGMs) mines on particularly the western limb of the Bushveld Complex, Mining Weekly Online can today report.
Well ahead of the latest price decimation, platinum company CEOs were expressing concern about the lossmaking position of western limb PGMs mines, which account for 55% of South Africa’s platinum production and provide 136 000 direct mining jobs.
At the time of going to press, the platinum price was $801/oz, which even rand conversion is unable to embellish to an acceptable level. As long ago as February 2012, the then Anglo American Platinum CEO, Neville Nicolau, was unequivocal about $1 900/oz being essential for the capital investment required to maintain long-term production.
While the current record price of palladium is a major plus, the benefit this provides is significantly eroded by the woes of platinum, which contributes 58% to the western limb’s overall PGMs basket, compared with palladium’s 32%.
Even when account is taken of all six PGMs, observers closest to the metals are advocating strategic intervention in order to provide more effective management of the PGMs commodity cycle in the interests of preserving what is a national patrimony.
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