THE tragic events at the Marikana mine have yet to have a significant impact on world platinum production, so while the violence brings global attention, focus should remain where it belongs, on the investigation of the shootings and the resolution of the labour dispute.
There was a five per cent rally in the white metal’s price last week, but it remains a good 15 per cent below its February peak and 30 per cent below its peak this time last year. Larger factors than Marikana, namely global economic weakness depressing demand for the metal’s industrial uses, especially in Europe’s car industry, are still much more important considerations.
You can see why if you consider that only about two per cent of Lonmin’s annual output has been lost so far. As a fraction of global platinum output in 2011, that’s just 0.23 per cent.
However, platinum deposits are highly concentrated, with South Africa having 80 per cent of the world’s known platinum reserves. Any suggestion that these labour issues are not exceptional, or that they cannot be swiftly resolved could see prices spike further.