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Platinum Group Metals

Palladium Just Smashed Another Record – by Elena Mazneva and Yuliya Fedorinova (Bloomberg News – January 8, 2019)

https://www.bloomberg.com/

Palladium’s premium to platinum jumped to a record, building on its ranking as the best-performing metal of 2018.

Shortages of the metal used in autocatalysts for gasoline-fueled vehicles sent its price to yet another all-time high, widening the price difference with rival platinum to more than $500 an ounce on Tuesday. Most analysts don’t see supply relief for palladium anytime soon.

Both metals are used in catalytic converters to reduce vehicle emissions. Platinum, the more expensive of the two for most of this century, has seen usage decline from its key consumers, diesel carmakers. Demand slid as consumers turned away from diesel vehicles in the wake of Volkswagen AG’s emissions-cheating scandal.

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Why this precious metal (Palladium) is worth more than gold right now – by Lucy Dean (Yahoo Finance – December 17, 2018)

https://au.finance.yahoo.com/

Most commonly used for cars’ exhaust systems, palladium has recently shot above gold in price. Earlier this month palladium scooted in front of gold for the first time in 16 years, and held this position for three days.

The record-breaking rally came after its price surged more than 50 per cent in four months, as demand grew and supply shrank. The precious metal is most commonly used to reduce cars’ exhaust emissions. As it’s a noble metal it’s resistant to corrosion. The silvery metal is a byproduct of mining other metals like gold and was previously considered worthless.

Most of it is produced from Russian nickel mining and South African platinum mining. Car manufacturers love it because it converts harmful carbon monoxide into less harmful substances.

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Norilsk Nickel to invest $12bn in production over next five years – by Nastassia Astrasheuskaya (Financial Times – December 10, 2018)

https://www.ft.com/

Russia’s metals and mining major Norilsk Nickel plans to invest more than $12bn in production development over the next five years in order to boost production volumes, the company’s chief executive officer Vladimir Potanin said Monday.

The world’s largest producer of palladium, and one of the leading producers of nickel, platinum and copper, thus signalled a change of strategy from flat output to growth amid stronger global demand for its products.

“We are implementing a rather unprecedented investment programme: we are investing more than $12 billion in production development in the next five years,” Mr Potanin told Russia’s President Vladimir Putin in a meeting, according to the Kremlin transcript.

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Zimbabwe sees no radical change for platinum, diamond ownership (Reuters Africa – November 26, 2018)

https://af.reuters.com/

LONDON, Nov 26 (Reuters) – Zimbabwe does not plan to change its ownership rules for diamonds and platinum, its mining minister said on Monday, denting hopes among some miners the country will open up ownership as it announces mineral frameworks in coming weeks.

Zimbabwe in March changed its empowerment law limiting the rules that mandate majority state ownership to diamond and platinum mines, rather than to the mining sector as a whole.

Speaking on the sidelines of an investment conference in London, Minister of Mines and Mining Development Winston Chitando told Reuters there would be “no change” for diamonds and platinum when asked about industry speculation the indigenisation rules could be relaxed further.

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China’s Fight Against Smog Makes Palladium 2018’s Best Metal – by Marvin G Perez (Bloomberg News – November 18, 2018)

https://www.bloomberg.com/

(Bloomberg) — Palladium prices are shattering record highs, and investors are betting that tight supplies mean the bull run is just getting started.

The metal, used in pollution-control devices in cars, has jumped almost 9 percent this year in New York, the best performance among major metals. Demand is roaring thanks to China, which is on a mission to reduce smog emissions. Tougher pollution standards mean carmakers are using more of the commodity in catalytic converters.

Global palladium production is falling short of the robust demand, and market forecasters including Citigroup Inc. are projecting further price gains ahead. Hedge funds are also wagering on an extended rally, with the biggest positive bet on the metal since early March.

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Lonmin and state oppose mining forum’s court bid against Sibanye takeover – by Allan Seccombe (Business Day – October 22, 2018)

https://www.businesslive.co.za/

Lobby group demands the platinum miner first complies with its social and labour plans

A court challenge to stop Sibanye-Stillwater’s R5bn takeover of Lonmin by challenging the platinum miner’s adherence to a social and labour plan was branded as deeply flawed and misleading by Lonmin.

The department of mineral resources, which stands accused by Mining Forum of SA and its president Blessings Ramoba of being ineffectual in its dealings with Lonmin’s social and labour plans, acted equally as angrily as the platinum miner, requesting the court in its affidavit to throw the matter out and order “punitive costs” against the forum and Ramoba.

The forum and Ramoba argued that Lonmin “never complied with its statutory obligations over the years of conducting its operations”. “It has been able [to] successfully evade its obligations principally because of the lack of effective policing by the department of mineral resources,” they said.

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Platinum Miners Their Own Worst Enemies: Joburg Mining Update – by Felix Njini and Paul Burkhardt(Bloomberg News – October 3, 2018)

https://www.bloomberg.com/

South African mining executives, investors and officials gather in the nation’s economic hub for the Joburg Indaba conference, a week after Mineral Resources Minister Gwede Mantashe published the government’s new Mining Charter.

It’s been a tough couple of years for South African mining, from regulatory uncertainty and legal fights with the government, to thousands of job cuts announced across the industry. National gold production has declined for 10 straight months.

Here are the latest developments, updated throughout the day. (Time-stamps are local time in Johannesburg.)

Platinum Mea Culpa (5 p.m.)

Platinum miners hurt themselves over the past decade by failing to notice and respond quickly enough to dwindling demand for the metal, according to the head of the world’s top producer.

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Lonmin ends Canada prospects as it cleans house before Sibanye takeover – by Alan Seccombe (Business Day – October 1, 2018)

https://www.businesslive.co.za/

By selling its 6.8% stake in Wallbridge, Lonmin is ensuring a stronger balance sheet and a tidier company for the new owners

As the takeover of Lonmin by Sibanye-Stillwater draws closer, the world’s third-largest platinum miner continues to tidy its investment portfolio and add cash to its balance sheet.

Lonmin has agreed to sell its 6.8% stake in Canada’s Wallbridge Mining for $4m to Eric Sprott, who will now hold more than 16% of the exploration and mining company through one of his companies.

Lonmin is the subject of a friendly all-share takeover bid by Sibanye, with key conditions including approval from SA’s Competition Tribunal following a highly conditional recommendation from the Competition Commission, yes votes from shareholders in both companies and court approval in the UK.

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Numbers looking solid for River Valley project – by Karen McKinley (Northern Ontario Business – September 20, 2018)

https://www.northernontariobusiness.com/

New Age Metals holds annual tour of proposed platinum group mine, gives updates on progress of project

New Age Metals’ River Valley project could be a historic mine site, according to its developers, so long as investor confidence and the markets remain strong enough to see it become a reality.

Investors, First Nations partners, geologists and curious members of the public were invited on Sept. 12 to take a site tour of the proposed open pit mine, located approximately 100 kilometres northeast of Sudbury.

Visitors were first taken to a core shack in the town of River Valley, 22 kilometres south of the site, to examine samples, and then brought to the 16,000-acre, 16-kilometre-long site itself, to examine outcroppings and drill hole locations. Company representatives also fielded questions on the history of the region, potential economic benefits and recent developments.

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Lac des Iles Mine has 10 more years of life: North American Palladium releases new feasibility study, mine plan for northwest operation (Northern Ontario Business – September 17, 2018)

https://www.northernontariobusiness.com/

The discovery of new underground reserves has pushed the life of the Lac des Iles Mine (LDI) to 10 years. North American Palladium (NAP) released an updated feasibility study and mine plan that projects a longer mine life at its operation, north of Thunder Bay.

NAP has been employing a more efficient bulk mining method – known as sublevel shrinkage (SLS) – in the lower part of the mine that it intends to utilize at other near-surface resources on their property. In June 2017, NAP put out a feasibility study that projected nine-and-a-half years of mine life. The updated study extends it by one year to 2027.

North American Palladium regards LDI as already one of the lowest cost underground mines in Canada. The new study shows improved margins, cash flows, mine life and net present value relative than what the company released in June 2017.

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Implats Sees Wider Loss as It Writes Down Rustenburg Assets – by Felix Njini (Bloomberg News – August 20, 2018)

https://www.bloomberg.com/

Impala Platinum Holdings Ltd. said its annual loss will widen as the world’s second-largest producer of the metal takes a 9.7 billion-rand ($660 million) writedown, mostly on its struggling Rustenburg mining complex.

Implats, as the company is known, is shrinking the number of shafts at Rustenburg and said earlier this month it may cut about 13,000 jobs as focus shifts to newer, lower-cost mines.

The company has struggled to reduce expenses at Rustenburg and profit margins in the platinum industry have come under added pressure this year after prices for the metal sank to the lowest in a decade.

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Currency Shocks Knock Platinum to 10-Year Lows – by Peter Hobson (U.S News/Reuters – August 17, 2018)

https://money.usnews.com/

LONDON (Reuters) – Platinum prices tumbled to 10-year lows as the collapse of Turkey’s lira rippled through markets and weakened the currency of top producer South Africa, underlining persistent oversupply of the autocatalyst metal.

Platinum has been caught in a broad sell-off as investors rush to the safety of the dollar, pushing it higher and making dollar-priced metals more expensive for buyers using other currencies.

But platinum, used mainly in emissions-reducing catalytic converters for vehicles and in jewelry, has fallen further than its precious metal peers.

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UPDATE 1-Russian miners explore payment schemes eschewing dollar – by Polina Ivanova (Reuters U.S. – August 15, 2018)

https://www.reuters.com/

MOSCOW, Aug 15 (Reuters) – Two of Russia’s biggest mining companies said on Wednesday they were investigating rouble-based payments schemes, amid calls from Moscow to reduce the role of the U.S. dollar in Russian trade and so limit the impact of U.S. sanctions.

The Kremlin said on Monday that Russia favoured bilateral trade with all countries in their national currencies, rather than the dollar, but that the idea needed detailed work before being implemented.

Russia’s Norilsk Nickel, which vies with Brazil’s Vale SA to be the world’s biggest nickel producer and is the world’s top palladium producer, said on Wednesday it was discussing the possibility of settling payments in roubles with foreign customers that had signalled their readiness for such an arrangement.

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World’s Priciest Precious Metal Set to Blossom as Shortage Looms – by Rupert Rowling and Eddie van der Walt (Bloomberg News – August 3, 2018)

https://www.bloomberg.com/

The world’s most expensive precious metal is set to get even pricier as a mining retreat in South Africa threatens a supply shortage.

Rhodium — a byproduct of platinum mining that’s used in the chemical sector and by the auto industry in catalytic converters — has more than trebled in value since the start of 2017. The silver-white element, named after the Greek word for rose, could go even higher as output is squeezed by the woes facing South Africa’s platinum industry.

With no primary mines for rhodium, supply will be cut as Impala Platinum Holdings Ltd. and Lonmin Plc shut unprofitable shafts to weather the lower platinum prices brought by the switch from diesel cars.

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South African platinum producer Implats to slash 13,400 jobs as costs bite – by Ed Stoddard and Tiisetso Motsoeneng (Reuters U.K. – August 2, 2018)

https://uk.reuters.com/

JOHANNESBURG (Reuters) – Miner Impala Platinum (IMPJ.J) will slash about a third of its workforce over two years in one of the biggest rounds of job cuts by one mining company in living memory in South Africa as the platinum industry faces a day of reckoning.

The number of platinum miners employed in South Africa, the world’s largest producer of the precious metal, has fallen from a peak of almost 200,000 in 2008 to 175,000 in the face of depressed prices and soaring costs, fuelling labour and social unrest.

Job cuts are politically sensitive in the country and Mines Minister Gwede Mantashe, a gruff former trade unionist, called Implats’ announcement on Thursday “a clear example of a company that is careless…Their reckless actions add injury to insult”.

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