The West has very little platinum or palladium — only 5% of the global supply is produced in North America. South Africa is the largest producer of platinum in the world, with 73%-80% of known platinum reserves.
Russia produces 40-50% of the world’s palladium supply (Johnson Matthey).
- Production in South African mines is declining.
- South African labor disputes continue to affect supply.
- China’s supplies of Platinum Group Metals are depleted.
- China will increase imports from Russia.
- Russian stock-piles are depleted.
- Large deficits of platinum and palladium are forecast.
- Analysts are projecting a possible ten-year supply deficit.
as less is mined.
World production of Platinum Group Metals
is geographically concentrated: 88% of world
platinum production is in South Africa and Russia
(Russia 13%, Zimbabwe 5%, North America 5%); 80%
of world palladium production is in Russia and South Africa.
Platinum is a strategic metal. It is necessary in electrical, chemical, medical/ dental, glass, and turbine manufacturing; in automotive industries (catalytic converters); in petroleum refining; in jewelry manufacturing; and investment.
Platinum Group Metals (PGMs) are used in one fifth of all manufacture. PGMs include platinum, palladium,
iridium, rhodium, osmium and ruthenium.
Years of violent strikes have forced platinum mine
closures in South Africa’s Rustenburg platinum belt.
Now, a significant amount of production has been lost.
The majority of South African miners of PGMs (Platinum Group Metals) are operating at a loss and production is falling.
The world’s largest platinum producer – Anglo American Platinum Ltd. (Amplat)– has cut employees, closed some operations (four mine shafts) and one mine. Amplat’s four Rustenburg mines account for 45% of world production.
On Dec. 8, 2015, Anglo American announced restructuring will reduce its assets by about 60%. The world’s fifth largest miner will lay off almost two thirds of its employees (85,000).
The world’s second largest platinum producer – Impala Platinum Holdings, Ltd. (Implats) owns the mine where thousands of men began a strikes as long ago as June 3, 2013. South African mining firms have been forced to trim production. Multiple strikes have crippled gold and platinum production at seven gold and platinum mines.
As a result of strikes, a 15% EXPORT TAX WAS IMPOSED January, 2015.
Less platinum & palladium will be produced in the
future. Those in the mining industry in South Africa
fear nationalization and greatly increased taxation.
By Denise Rhyne
Platinum and palladium are recommended as investment metals for large portfolios. Silver and gold are “monetary metals.” We recommend taking delivery of gold and silver coins before buying palladium and platinum coins and bars.