BDlive reported that according to Natixis, over the next two years, platinum prices will largely be determined by what happens in South Africa. To some extent, palladium prices will also be dictated by what happens in the country.
As quoted in the market news:
‘For the next two years, the situation in South Africa will remain the biggest risk to platinum prices,’ Natixis said in its second-half review. South Africa is the world’s single largest source of platinum, making up about 80% of supply.
‘Adverse government decisions, a protracted power outage and most importantly a serious escalation in labour unrest could lead to a significant shortage and higher platinum prices,’ it said.
‘The South African government seems to be unable to solve the root of the problem facing the mining companies. We are still years behind the completion of a reliable national power supply, and the government has been unable to resolve the core economic issues facing the population and the country,’ it said.
‘The whole situation is making foreign investment unattractive in the mining sector,’ Natixis said. It sketched two possible price scenarios over the next two years.