Investec cuts platinum forecast on soft demand outlook
miningweekly.com
By: Reuters
Published on 9th January 2009
South African investment bank and asset manager Investec cut its 2009 and 2010 price forecasts for platinum, palladium and rhodium, citing a downturn in demand from industrial users such as carmakers.
"The platinum price has rallied in the last few weeks, but a weak rhodium price and strengthening rand mean the platinum group metal basket price remains low and a number of mines are still losing money," said Investec analyst Rebecca O'Dwyer in a research note.
"We see downside risk to the platinum price in the near-term, particularly if vehicle sales continue to decline in the first few months of 2009."
The bank said it now sees platinum prices at $970 an ounce in 2009 and $1 350 an ounce in 2010, down from previous forecasts of $1 350 and $1 675 an ounce respectively.
It expects palladium prices of $220 an ounce in 2009, down from a previous forecast of $318, and sees the metal at $250 in 2010, against $350 previously.
Investec also slashed its rhodium price estimate for 2009 to $1,350 an ounce from $5,625, and for 2010 to $2,250 from $6 425.
However, the bank left its long-term forecasts for platinum and palladium unchanged at $1 300 and $350 an ounce respectively.
The bank said this reflected its view that while 2009 will be "a difficult year for vehicle sales,... on a longer term perspective, the fundamentals for platinum group metals demand remain very attractive."
Spot platinum was quoted at $988/993 an ounce at 11:31 GMT, against $990,50 late in New York on Thursday. Palladium was at $193,50/198,50 an ounce from $194,50. |
