SA Platinum Producers Upbeat Despite Headwinds From Abroad

A court ruling in Germany will give cities in that country the right to ban diesel-powered cars from their streets, which in turn could have a significant impact on platinum demand.

- David McKay

The view of Royal Bafokeng Platinum (RBPlat) CEO Steve Phiri, is that primary platinum production in South Africa will continue to decline – about 195 000 ounces this year or nearly 3% of the total – while demand for the metal will increase, marginally.

This is pretty much the consensus throughout the industry, which has seen fabulous increases in demand for platinum’s sister metals – rhodium and palladium – but little in the way of an improvement for platinum, which they mine the most. While 2017 has been a dispiriting year for platinum, the general expectation is that the clouds are likely to blow away soon.

And yet things keep happening to upset the sector’s applecart. One is a recent court decision in Germany giving its cities the right to ban diesel powered cars from their streets – a development that, were it to be taken up, would have a significant impact on the demand for platinum, which is used extensively in diesel catalytic converters. In fact, an estimated 12m cars complying with the so-called Euro 5 and earlier emission standards for noxious fumes would be affected.