Palladium Producers to Benefit from Price Hike
Source: Business Report (2/28/11)
"S.A. palladium exports have dropped since last year."
Analysts have speculated that the price of palladium could advance to levels last seen a decade ago due to the demand from the Chinese motor industry. Prices climbed 98% in the past year to $833/ounce.
Zingaphi Jakuja, a spokeswoman for the Department of Mineral Resources, insists that South Africa is not taking full advantage of the climbing price of palladium.
She said South Africa's platinum group metals mining industry, in general, was export oriented and therefore the country was likely to reap any benefits associated with an increase in price.
"However, indications are that the country is not taking full advantage of the current palladium price boom, given the fact that a lower proportion of all the palladium produced in the country was exported in 2010 when compared to the year before."
According to the department, in 2009 about 87% of all the palladium produced in South Africa was exported, with this figure dropping to 77.7% in 2010.
A total of 75.1 tons of palladium was produced in 2009 and 89.9 tons in 2010. Of the 20 tons of rhodium produced in 2009, 95% was exported, while 93% of the 22 tons produced in 2010 were exported.
Impala Platinum Spokesman Derek Engelbrecht said: "It is very difficult to take advantage of the situation, other than simply enjoy higher revenue for the metal we have produced.
He said from the company's total production, 10% was returned in the form of tolled metal and therefore could not be sold. However, between 60% and 65% of the remainder was sold locally.