LAUNCESTON, Australia, March 24 (Reuters) – The spread of the coronavirus across the world has focused metals markets on the risks to demand, causing prices to plummet, but so far investors have largely ignored the mounting threats to supply.
A hint of what may be coming was South Africa’s decision on Monday to impose a 21-day nationwide lockdown to try and contain the epidemic, a move that will affect the nation’s mines.
South Africa is the world’s largest producer of platinum, the second-largest of palladium and is also a major exporter of thermal coal, iron ore and gold. The country dominates global platinum production, with its output of about 130 tonnes in 2019 nearly six times more than the next biggest producer, Russia.
Like most metals, platinum had been hit hard by the sell-off as the coronavirus spread from its source in China to Europe and North America, prompting several nations to shut down much of their economies to contain the disease.
Spot platinum fell 46% from its peak this year of $1,041.05 an ounce to its low of $558 on March 16, and it traded sideways since then to close at $642.50 on Monday.