Zimbabwe eyed as heir to platinum throne as SA loses grip – SFA Oxford – by Martin Creamer (MiningWeekly.com – October 31, 2013)

 miningweekly.com

JOHANNESBURG (miningweekly.com) – With South Africa’s once mighty grip on the world platinum market slipping, exasperated end-users are eyeing Zimbabwe as the heir to the platinum throne, top global platinum consultant Stephen Forrest said on Thursday.

Forrest, in South Africa for the Joburg 2013 Investing in Resources and Mining in Africa conference attended by South African mining’s who’s who, told Mining Weekly Online in an exclusive interview in Johannesburg that invested parties across the platinum value chain were viewing South Africa’s diminishing influence with concern.

Zimbabwe, Russia and North America had lower platinum group metal (PGM) ounce cash costs and received substantially higher by-product credits than South Africa, SFA Oxford’s director and principal consultant revealed.

Since 2009, there had been a fourfold increase in platinum recycling, from 500 000 oz in 2000 to more than two-million ounces a year. “Put simply, recycling is now offering the industry Lonmin-sized output incrementally every five years,” Forrest’s research showed.

The platinum landscape was changing “fundamentally and irreversibly” as decades-old dynamics fell victim to a market wanting certainty and security.

In the wake of a trebling of South Africa’s total cash costs since 2003, South Africa’s main prospect of cash cost lowering was rand weakening.

In the same period, North American and Russian cash costs had risen only 1.4 times and 1.5 times, respectively, and Zimbabwe’s had doubled.

Since 2009, South Africa’s platinum supply had fallen from more than 70% of demand to only 50% of demand now.
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