By: www.iol.co.za

Impala Platinum (Implats) expects the outlook for platinum group metals (PGMs) to remain challenging in the short term, especially as lower prices persist, forcing South Africa miners of the precious metal to cut costs, close non-profitable shafts and limit fresh investment.

According to the World Platinum Investment Council, South African (PGM) producers will influence global refined supply which is expected to firm up by 1% next year. This comes at a time Implats and Northam Platinum among others are holding excess inventory.

This year, world platinum supply will grow to 7.3 million ounces, with refined mine supply likely “depend heavily on the volume of semi-finished inventory that South African producers” are able to release. However, such measures have not translated to a marked improvement in platinum prices and Implats believes that the near-term outlook will be less rosy.

“Our expectation is that the physical market will improve further over time with an improved macro outlook, ongoing supply responses and a more pragmatic auto electrification outlook. However, the near term could remain bumpy for some time,” Johan Theron, the spokesperson for Implats told Business Report by email.

As at the 2024 third quarter, Implats was holding 230 000 ounces of inventory while Northam had about 60 000 ounces. Implats and Northam estimate that it may take up to three years to fully release this inventory although the rate of release for 2025 is expected to play a significant role in shaping global mine supply levels.