Tag: Lonmin

Gold Price the Winner in Early June; Rest of Precious MMI Flattens

Gold Price the Winner in Early June; Rest of Precious MMI Flattens

Here’s What Happened

  • All quiet on the precious-metals front this month, as our Global Precious Metals MMI held pat from May to June at a reading of 84.
  • Since we tend to keep a closer eye on the platinum group metals (PGMs) due to their automotive applications, the U.S. platinum price tracked by the MetalMiner IndX posted only a negligible gain, while the U.S. palladium price suffered only a negligible loss…reflected directly in the wash that was the sub-index’s June performance.
  • Interestingly, gold has been getting hot as of late. More on that below.

What’s Going On in the Background?

  • Although the Global Precious Metals MMI did not reflect it in the May-to-June time period, the U.S. gold price increase after June 1 has gotten some heads turning. As my colleague and new MetalMiner Editor Fouad Egbaria reported earlier this week, “gold neared its year-to-date high on Tuesday,” according to Reuters. “The rise comes in a climate of political uncertainty, with an election in the United Kingdom, former FBI Director James Comey’s testimony before the Senate Intelligence Committee on Thursday and a European Central Bank meeting this week,” Egbaria noted.
  • Back to platinum. As a reflection of the metal’s dawdling short-term pricing, South African producer Lonmin has been struggling, so much so that Reuters reported earlier this week that the company is “pulling every lever to try to restore confidence in its ailing business, including reopening a major shaft and expanding its biggest operation,” according to Lonmin’s CEO. Low prices and skyrocketing costs have reportedly conspired to present the company with a cash problem over the past near-decade.

What Metal Buyers Should Look Out For

  • Platinum specifically has had a low-price problem this year — but that’s obviously less of a problem if you’re purchasing metal. While we’re unsure of when prices will swing back up, mainly because output cuts in South Africa and elsewhere have seemingly not helped, it may be hard to discount current windows for smaller spot buys.

Exact Prices of the Key Movers and Shakers

Molycorp Secures $130 Million Loan from Oaktree, Lonmin Warns of Layoffs

Molycorp Secures $130 Million Loan from Oaktree, Lonmin Warns of Layoffs

In metal news today, Molycorp, Inc. is sitting a little bit prettier in its chapter 11 reorganization and South Africa’s Lonmin PLC is warning that layoffs could come from mine closures soon.

Molycorp Secures Financing

Molycorp, Inc., the only US-based producer of rare earth minerals, recently moved forward with its chapter 11 bankruptcy reorganization process and received court approval for an improved debtor-in-possession financing package provided by Oaktree Capital Management LP.

Three Best Practices for Buying Commodities

The approved DIP facility of new net financing of $130 million. Molycorp said the new funding will include additional liquidity, reduced costs, and additional time to develop a plan of reorganization that would be in the best interest of all parties.

Lonmin Warns of Layoffs

South African platinum producer Lonmin said on Friday it was planning to close or mothball several mine shafts, putting 6,000 South African jobs at risk, because of depressed metal prices. Platinum’s spot price is at 6-1/2 year lows less than $1,000 an ounce, while power and labour costs in South Africa have risen sharply.
Free Download: July Metal Price Forecast

Why Glencore Will Divest Its Stake in Platinum Producer Lonmin

Why Glencore Will Divest Its Stake in Platinum Producer Lonmin

Some members of the press (including us) have covered Glencore Xstrata’s positioning of two senior division heads Gary Nagle, the boss of its alloys division, and Paul Smith, head of […]

Lonmin Still Fragile as Daily Silver Price in Japan Spikes Up

Lonmin Still Fragile as Daily Silver Price in Japan Spikes Up

South Africa’s Lonmin – and even power generation and automotive industries – still can’t control strikes, leading to volatility in the region and translating to metal and other commodity volatility […]

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