South African mining has some very tough questions to ask itself as to what exactly its platinum sector is going to look like when the fallout from the current violence subsides.
by Geoff Candy
GRONINGEN (MINEWEB) – It was going to take something truly awful to tear platinum traders’ eyes away from the ever-changing patterns of the European crisis and the poor demand outlook for the metal it has engendered. But, not even the most ardent bulls, could have imagined the scenes at Lonmin’s Marikana operation near Rustenburg or the ever increasing death toll.
But, while terrible, the violence has served to bring the supply issues currently facing the South African platinum sector into sharp relief. And, as a result, prices are finally moving. Platinum prices rose around $40 an ounce yesterday and have continued that move today. That is not to say that the problems facing the sector were being kept a secret. It is just that many people were too focused on the demand side of the equation to worry that much about supply.