Nicky O wants Africa’s economic lions to roar, small car push may favour palladium, rhodium, exploration cuts could see prices soar on upturn

De Beers chairperson Nicky Oppenheimer wants Africa’s economic lions to be made to roar. Read on page 6 of this edition of Mining Weekly of Oppenheimer’s call for the economic lions of Africa to work together towards improving the continent’s competitiveness “urgently”.

The head of the world’s biggest diamond-mining company told the African Union, in Addis Ababa, on Africa Day that acceptance of the philosophy of economic competitiveness was crucial to the creation of economic growth on the continent.

Oppenheimer sees competitiveness as the lifeblood of economic growth and the linchpin of social harmony and political stability. He urged the continent to build coalitions for growth and to use the global economic meltdown to develop an African way of doing business, grounded in fairness, integrity and sustainable development.

The determination of the world to reduce its carbon footprint may have an impact on the palladium price, which currently lags many times behind the platinum price. Read on page 16 of this edition of Mining Weekly of the world moving to smaller, palladium-rich petrol vehicles as consumers downsize their cars and of the gap closing on fuel efficiency between petrol and diesel engines.

Against that background, GFMS CEO Paul Walker sees a palladium decade ahead, and Lonmin CEO Ian Farmer says that the platinum price will not rebound before 2011/12. The current global environmental thrust is emphasising the lowering of carbon dioxide emission, which puts an emphasis on fuel efficiency and the ignition of less fossil fuel per kilometre rather than an emphasis on car exhaust catalysts or autocatalysis.

New small models on the drawing board will demand palladium and rhodium, and not platinum, says Walker.

Cuts in exploration expenditure could send commodities prices soaring when economic activity rebounds, says Ernst & Young. Read on page 14 of this edition of Mining Weekly that it makes sense for mining majors and juniors to preserve cash at this stage but the consequence could be a scramble for scarce resources when the global economy recovers.

Ernst & Young sees the flow of new projects through the development pipeline being constrained, and increasing demand from recovering economies putting pressure on the supply-demand balance.

To watch a video on GFMS CEO Walker on palladium, go to www.miningweekly.com and click on ‘Multimedia’ and then on ‘Real Economy Report’.