Paul Dunne, CEO of Northam Platinum, South Africa’s fourth-largest platinum-group metals producer, announced on Friday that platinum mining companies in the country, the world’s leading supplier of the metal, are grappling with “severe” market conditions, marking the worst crisis in three decades as prices plummet.
Dunne expressed his personal belief that the current situation is the most dire he has witnessed in thirty years, relative to past crises. He emphasized the severity of the industry’s predicament, stating that South Africa’s major producers are halting billions of rand in spending on output expansion projects and implementing job cuts to mitigate costs amidst plummeting profits due to lower metal prices.
Anglo American Platinum disclosed plans to slash 3,700 jobs, while Sibanye Stillwater has already laid off approximately 2,600 workers. Impala Platinum similarly warned of potential closure of loss-making shafts within six months if prices fail to improve.
Although Northam Platinum is currently refraining from job cuts, the company is withholding spending on projects, Dunne affirmed.
Platinum prices, predominantly utilized by automakers to reduce toxic emissions, have experienced a decline attributed to weaker economic growth in China and destocking by manufacturers following Russia’s invasion of Ukraine. On Friday, platinum dropped to $872.75 an ounce, while palladium, a sister metal, slightly rose to $944.68 an ounce.
Dunne expressed a grim outlook for the market, anticipating a challenging period ahead with no immediate signs of recovery. He emphasized the absence of indications for a swift rebound in the market, highlighting the severity of current conditions.
