http://www.reuters.com/article/2014/06/09/us-safrica-strike-idUSKBN0EK13320140609 They must be getting very close to a supply short squeeze - the 3 months stated stockpile has now stretched to 6 months and even if the strikers were back at work today it would take 3 months before the first 1oz of Pt was available ------ is this not a screaming buy or am I missing something? The Chinese had better get used to breathing in foul air this coming winter or paying much more for clean cars remember last winter ? http://www.smh.com.au/world/canned-...s-blanket-of-smog-returns-20130129-2dht3.html
nice $ 30 spike Ronnie - was it the unsuccessful negotiations in South Africa or the" Collateral Scandal " in China
Who knows possibly both. Next there will be a platinum order from Honda or Toyota that can't be filled and the price will go up another $100. The future is in real stuff not paper derivatives.
It will take as long as it needs until you get a "unexpected" failure to fill an order then we see prices double or triple. This is what happened with Pd, and Rhodium. For all "good" things you need to wait. http://agmetalminer.com/2014/06/11/...iners-strike-talks-end-no-agreement-in-sight/
South Africa produces 70% of the world's platinum and 39% of the world's palladium. Russia produces more Pd but its platinum contribution is pretty small. The other big producer is Zimbabwe lol Perhaps Gideon Gono is in charge there - he can definitely increase supply !!
Informal deal takes Pt down $40 - little premature? http://www.bbc.com/news/business-27819118 Clearly the Wall Street crowd have no understanding of the realities of South Africa.With a 20% food inflation how long before they are on strike again. Use the dips to buy more metal. Production will continue to decline as it has these past 5 years.
Heard on the car radio today (but can't confirm if its accurate or just hearsay))... that the union is now talking about MORE than just a pay rise. They want housing, infrastructure & security for the miners & families. And any pay rise will now have to be backdated to the beginning of the strike. :/
Whatever the deal - things to consider in the SA platinum industry 1. It will take 3-6 months to restart production in any meaningful way 2. Production has fallen these past few years before the strike due to 1. need to open new shafts 2. power shortages 3. Poor metal prices with limited funds for new expansion 3. Inflation in SA (food) is 15-20% -official 4. ANC government has threatened to withdraw mining licenses if mines don't pay more 5. Several mining companies have already closed some mines down 6. Infrastructure (stores and accommodation) already closed down and moved away 3 Questions remain ! 1. How much will the mines invest to increase production at these prices - Answer - nothing 2. Will production keep falling - Answer - Yes 3. When will they strike again - Soon The hedge fund crowd know nothing of this (except Rick Rule) -
It seems like I am the only one looking at Pt at cheaper prices as opportunity. It seems like the majority still look at Pt and Pd as some outcast industrial commodity. Ag has fallen by more than half from near $50 to a current $19. That is ok - no problem here. Platinum has fallen from a top of near $1900 in August 2011 to a current value of $1427. Nothing like the fall in Ag or gold for that matter. Yet as there is some weird concept that only monetary metals are going up, or will be saleable in the future ? lol. This correction is overdone as nothing in the long term has changed. Those 50,000 cars sold each day in China need a pollution reducing catalyst and paper contracts don't work.
Ronnie, if you're the only one who sees the opportunity, then perhaps you're wrong about Pt and Pd? Personally I have some exposure to Pt, but you may be underestimating the stockpiles that industrial users have and the forward contracts that they already have in place. Many folks here on silverstackers write off those working in the paper markets as being horribly uneducated and unintelligent when the reality isn't the case. You don't think that educated, informed individuals would see the problems that you (and I) see with the PGMs and their production/markets? If they do, why aren't the prices going to the moon? Perhaps we don't have the full picture and the stockpiles of industrial Platinum are meeting demand and will continue to do so for some time. I think your comment on the 12th regarding waiting for an event/order to be unfilled needs to occur before a drastic price rise. The high premiums and small market for Pt probably scare away most stackers, no use going to the moon if you can't cash in.
Screaming eagle -clearly I am not the only one investing in PGM . I think contracts are only pieces of paper and forward contracts are worth nothing in the face of a major supply contraction. I am not underestimating supply issues and like some time back when there was plenty of Pd and suddenly there was none, we are going to endure the same process once again. It makes no difference if the strike is resolved this week, labour and production issues have driven PGM supplies down year after year. The paper trading geniuses are telling me that making the mines even less profitable by massively increasing costs are going to fix the supply issue, ie prices will fall. Now the miners 70,000 of them will get a 20% pay rise and other benefits, that is sure to increase investment in South African PGM mining. Money will be available to invest in new shafts desperately required expansion and power requirements. Sure thing - in your dreams. This is an industry in collapse and even the CEO's have no idea were they are going to find the extra cash to pay these pay increases. All I am saying is don't look this gift horse in the mouth. Think this through a bit further.
To add insult to injury South Africa's credit rating cut which will increase interest rates and inflation http://www.ibtimes.com/south-africa...itch-sp-citing-platinum-mining-strike-1600914
From the Mining Weekly (South African Publication) Platinum, palladium deficits to increase JOHANNESBURG (miningweekly.com) As the future of the bulk of South Africa's platinum group metals (PGM) output hangs in the balance on the back of a protracted strike weighing on the nation's three largest producers, palladium and platinum deficits were likely to reach two-million ounces and 1.2-million ounces respectively this year, Standard Bank commodities head Walter de Wet told Mining Weekly Online. This was an uptick on Standard Bank's April forecast of a 815 000 oz platinum supply deficit for 2014 as a whole a volume that could have been down to 300 000 oz had the strikes not occurred and a palladium deficit of more than 1.5-million ounces. Palladium would close 2015 with a 1.3-million-ounce deficit and 2016 with a 1.8-million-ounce deficit, de Wet said. Further, the palladium price was likely to breach the $900/oz mark sooner than 2016, as previously forecast by the bank earlier this year, owing to rising palladium exchange-traded funds and supply constraints as the crippling strike continued with only a tentative end in sight. In April, Mining Weekly reported that Standard Bank had revised its 2014 palladium price forecast upwards to $785/oz, while palladium prices were expected to rise to $875/oz, $938/oz and $975/oz in 2015, 2016 and 2017 respectively. The market looked bullish for palladium, particularly as demand from the US and China rose, he noted.
And those who thought the strike was over - think again !!!! Platinum strike hopes dashed as union makes new demands JOHANNESBURG The Association of Mineworkers and Construction Union (AMCU) has made "unaffordable" new demands beyond a deal struck with producers last week, the companies said on Wednesday, dashing hopes of an end to the country's longest and costliest mining strike. The AMCU last week put a broad pay offer agreed "in principle" with producers to its members. While the striking miners urged union leaders to accept the salary increases offered, they voiced concerns about the timeframe of the agreement and other benefits such as housing allowances. "The response (from the union) contains new material outside the principle agreement," said Mpumi Sithole, spokeswoman at Anglo American Platinum (Amplats), the world's biggest producer. Impala Platinum said the additional demands included a R3 000 ($280) "come-back bonus" and a moratorium on all restructuring and retrenchments. Second article http://af.reuters.com/article/topNews/idAFKBN0ET12120140618
Platinum strike ends: The historic five month-long strike in the platinum sector has ended, the Association of Mineworkers and Construction Union (Amcu) said on Monday. The union accepted a wage settlement that would increase the basic salary of the lowest-paid worker by R1 000 over three years, excluding other benefits. Is this industry sustainable - the South African Rand has devalued 8% since the strike began which has gobbled up almost all the pay increases. How long before the next strike ?
