Imminent strike action at South Africa’s three largest platinum producers has failed to set the precious metal price alight as much as some may have thought.
The militant Association of Mineworkers and Construction Union (Amcu), the dominant union representing the three firms’ workers, has given notice that strikes will start on Thursday, with Amcu demanding higher pay.
The platinum price has risen by around $50 (£30.40) per ounce in two days – a significant move, but still a little lacklustre if you consider that Lonmin, Anglo American Platinum and Impala Platinum produce over 50 per cent of global supply.
“I’m not altogether surprised by the muted action,” Marc Elliot, analyst at Investec, told City A.M. “There has been evidence around for some time that there is simply a fundamental surplus.”
Another school of thought suggests that investors expect the strikes to be relatively short-lived, making any impact negligible.
Either way, no one seems worried about a platinum drought any time soon.