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Platinum prices defy global crisis

by Staff reporter
12 Mar 2021 at 06:48hrs | Views
ZIMBABWE'S platinum output increased by 5% to 476 000 ounces (oz) last year, the World Platinum Investment council (WPIc) said on Thursday, commending government for including the firms among essential services.

The three firms extracting the resource in Zimbabwe had produced 455 000 oz in 2019, when a major plant shutdown at one of the operations affected milling.

These are Impala Platinum's Zimplats, Unki, a unit of Anglo American Platinum and Mimosa. Zimbabwe holds the world's third largest proven platinum reserves after South Africa and Russia, and what it produces has an impact in global output and pricing trends.

In southern Africa, it had the only platinum mines that saw production rise during the final quarters of 2020 when Zimplats' output rose by 4% in the quarter ending September.

Unki mine saw platinum group metals output rise by 7%.

"In Zimbabwe, miners were allowed to continue through the country's lockdown, with only one mine impacted," the WPIc said.

"Country output increased 5% year-on-year to 476 000oz, reflecting disruptions in 2019 from a furnace rebuild. Production from Zimbabwe kept to levels similar to the previous few quarters.

"The year-on-year increase was due to the prior year period having been impacted by a furnace rebuild," the WPIc said.

It projected higher global demand for platinum this year. "Following its significant growth over the past two years, we forecast that investment demand, despite remaining robust, will not rise at the same pace," it said.

Last week, Zimplats said it was pressing ahead with expansion projects at its Ngezi operation with over US$500 million earmarked for Zimbabwe until 2028.

"Installation of key infrastructure is on schedule targeting full production in august 2025," Zimplats said of the Mupani mine project in its financial statements for the half year to December 31, 2020.

"A total of US$124 million had been spent on this project as at December 31, 2020 against a project budget of US$264 million. The board of directors approved the implementation of Mupani and Bimha mines upgrade (the replacement for Mupfuti mine) and the construction of a third concentrator plant at Ngezi at an estimated total cost of US$297 million.

"Work on the projects has commenced targeting to commission the concentrator plant in 2022 with the Bimha and mupani mines upgrades scheduled for completion in 2023 and
2028, respectively," it said.

The firm would be constructing a second concentrator at Ngezi, which will be brought on line next year.

That will give Zimplats bigger capacity to produce platinum, but still, the firm is mum on the establishment of another refinery in Zimbabwe.

The only platinum mines that increased output in southern Africa last year were in Zimbabwe.

But these were not enough to offset the downturn in South African mines, where the bulk of the region's platinum is mined.

The crisis is, if subdued growth persists, Sadc's platinum miners may miss out on projected higher global demand this year.

In January, Amplats reported total Platinum Group metals output of 1 076 100 ounces in the fourth quarter, representing a 7% slowdown on the comparable fourth quarter of the prior year.

Source - the independent