Platinum Prices Finally Rising as South African Miners’ Strike Stockpiles Run Low

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As the longest platinum/palladium mining strike in South African history enters its fifth month, producers continue to claim it could cost a million ounces of lost output this year, yet spot platinum’s price remains where it was when the strike broke out in January, at around $1,450 an ounce.

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The action, by workers at Anglo American Platinum, Impala Platinum, and Lonmin, has taken out 40 percent of global production of the precious metal, Reuters reported. Analysts have attributed the dormant price to the abundant stocks held by producers, which they were able to drip-feed through to consumers, cushioning them from the strike’s impact. But that cushion is getting thin.

“We probably have another 6-8 weeks to go before producers run really low on material they’ve stockpiled,” Standard Bank analyst Walter de Wet told Reuters. “Lonmin have come out to say that they have some stuff in the pipeline that they are processing, and it seems there is some material at Impala and Anglo, too. Anglo on average probably has the most metal compared to the other two.”

Prices are already showing sensitivity, hitting eight-month highs last week after Impala’s chief executive said last Thursday that the strike could last “much longer.”

Analysts say they could bounce back above $1,500/oz, a level not seen since last September.

The price of Japanese palladium bar increased by 1.7 percent on Friday, May 30 to JPY 2,733 ($26.86) per gram, making it the day’s biggest mover. Following two days of rising prices, the price of US palladium bar dropped 0.2 percent to $833.00 per ounce. The price of Chinese palladium bar held steady at CNY 189.00 ($30.30) per gram.

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Japanese platinum bar closed 0.6 percent lower at JPY 4,775 ($46.94) per gram. US platinum bar prices inched up 0.3 percent to $1,454 per ounce. The price of Chinese platinum bar rose 0.3 percent to CNY 312.00 ($50.02) per gram after a two-day drop.

Japanese gold bullion finished the day down 1.0 percent to JPY 4,101 ($40.31) per gram. Indian gold bullion ended the day at INR 25,680 ($435.92) per 10 grams, after the 0.8 percent drop last Friday. The price of Chinese gold bullion fell 0.3 percent to CNY 252.80 ($40.53) per gram. The price of US gold bullion flattened at $1,259 per ounce after two days of downward movement.

Japanese silver prices saw a 1.1 percent decline to JPY 623.00 ($6.12) per 10 grams. At INR 40,898 ($694.25) per kilogram, the price of Indian silver was essentially unchanged. The price of US silver showed little movement last Friday at $19.04 per ounce. Chinese silver saw little change in its price last Friday at CNY 4,160 ($666.88) per kilogram.

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