Currency-hit Anglo Plati-num (Angloplat) expects South Africa’s rand to trade weaker towards the end of 2009. 

“Although the current rand strength, which is depressing the rand revenue basket at present, is of concern, we do expect the rand to trade weaker towards the end of the year,” Angloplat CEO Neville Nicolau says.


Fairfax mining analyst John Meyer says in a note that either the currency must weaken or the price of platinum-group metals must strengthen, because the current situation is “unsustainable”.

Angloplat is clearly betting on a weaker rand as it does not see significant uplift in the dollar price of platinum. “We believe that the platinum price will find support at the $1 200/oz level during the remainder of this year,” says Nicolau.

Although Angloplat has a target to produce 2,4-million ounces of refined platinum this year, it says that it can sell up to 2,6-million ounces, if necessary, by drawing on stocks in the pro-
cess pipeline.

Looking beyond one year, Angloplat is priming its operations to produce 2,5-million 
ounces a year for the next three years, but will do so flexibly.

“Given that it’s extremely difficult to plan for short-term market changes – as we have just established in the past year – we 
intend to establish flexibility and to increase our ability to react to these shifts more efficiently than traditionally has been the case in underground hard-rock mining environments,” he says.

Angloplat’s three sources 
of flexibility will be the Mogala-kwena openpit mine, which can be ramped up or down more practically and more efficiently than its underground mines; adjusting volume 10% either way from its high-output underground operations on a short-term basis; and drawing on stocks from the pro-
cess pipeline.

Angloplat calculates that the market is currently in balance, but that a deficit is likely to arise in the next few years, as the global markets recover.


“As a consequence, we expect platinum prices to trend to the long-term level of $1 350/oz, as supported by the global economic 
recovery,” he adds.

To watch a video in which Angloplat CEO Neville Nicolau spells out to Mining Weekly Online his belief that the rand will weaken towards year-end, click here.

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