2014 not a typical year for platinum – WPIC
11th March 2015 By: Natasha Odendaal
miningweekly.com
JOHANNESBURG (miningweekly.com) – Global platinum production ended 2014 with a 700 000 oz deficit in what the World Platinum Investment Council (WPIC) believed was not a typical year for the volatile commodity.
The council also established that global above-ground platinum stocks were currently at 2.6-million ounces, down from more than 4.1-million ounces in 2012 and 3.44-million ounces in 2013 – a reduction that was attributed mostly to the prior two years’ platinum shortfalls, South Africa’s unprecedented five-month strike halting platinum production at the start of 2014 and significant demand for platinum in exchange-traded funds since 2012.
The recently established WPIC on Wednesday published its second ‘ Platinum Quarterly’, which outlined that global platinum supply, at 7.2-million ounces for 2014, was down 8% on that of 2013, while global demand had decreased by 7% year-on-year to 7.9-million ounces.
In the first half of the year, the lengthy mining strike in South Africa led to a 905 000 oz deficit, with the second half recovering to a 205 000 oz surplus, owing to short-term investment outflows, WPIC research director Trevor Raymond said.
Demand during 2014 was driven by the automotive, jewellery and industrial segments, which grew by a collective 200 000 oz – an increase that was significantly overshadowed by a 790 000 oz fall in investment demand in 2014 to 135 000 oz.
OUTLOOK
After a “particularly trying year” in 2014, the report indicated that further challenges would be encountered in 2015, with the market remaining in a deficit, albeit a lower level at 235 000 oz.
However, global refined production would recover to levels close to that of 2013, particularly as South Africa’s mines bounced back from the crippling strike, delivering output of around four-million ounces.
“Global mine production is, therefore, forecast to grow by 19% year-on-year to 5.7-million ounces and further destocking is expected, which could put total mining supply at 5.8-million ounces in 2015,” the Platinum Quarterly outlined.
The WPIC noted that restructuring and delayed shaft projects meant that some mature mines were unlikely to achieve 2013 production levels, though growth was forecast at several newer operations.
Global demand was also expected to rise this year, driven mainly by a 9% increase in industrial demand, in addition to higher vehicle production and higher platinum loadings in autocatalysts.
Automotive demand for platinum was predicted to increase by 4% to 3.4-million ounces on the back of tighter emissions legislation in Western Europe, diesel vehicle volume increases in North America and a return to growth in India.
There was also an expected upswing in wider nonautomotive industrial demand for platinum, which was typically driven by global economic growth.
WPIC reported that the jewellery “successes” over the last ten years would continue, while platinum jewellery demand was forecast to rise by 3% to 3.08-million ounces.
Jewellery recycling could register a marginal decrease to 725 000 oz; however, autocatalyst recycling would jump 16% to 1.4-million ounces |
