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On-The-Air (10/03/2023)


10th March 2023

By: Martin Creamer

Creamer Media Editor


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Every Friday, SAfm’s radio anchor Jon Gericke speaks to Martin Creamer, publishing editor of Engineering News & Mining Weekly. Reported here is this Friday’s At the Coalface transcript:

Gericke: Global thumbs up for platinum-based fuel cell vehicles is giving South Africa’s platinum sector another big boost.

Creamer: We use platinum in the internal combustion engine, but there is the battery electric vehicle, which is starting to move into that space. Although platinum might also be used in that battery, it is not certain yet. So it is important that South Africa doesn't lose its market share in the automotive industry, which is changing.

The reports coming through this week are extremely encouraging, because what is coming forward, far faster than imagined into viability, is the hydrogen fuel cell electric vehicle, which is joined at the hip to platinum. So the flux is quite confusing. There is so many different thrusts at the moment. What they did is they looked at the total cost of ownership. In terms of the total cost of ownership, which is the way to actually measure this, the hydrogen electric fuel cell vehicles that use platinum, particularly at the buses and the trucks and heavy vehicles, but also going into the car range, should become competitive in terms of total cost of ownership, as soon as 2026.

That would make them competitive with the battery electric vehicle. Then the internal combustion engine, they are likely to be competitive with that, in terms of total cost of ownership, the following year. The way they are looking at this is holistically and also the source of the metals is much easier in South Africa than all the other critical metals that are needed for the battery electric vehicles. Then the is the recycling factor, and as it turns out, the hydrogen fuel cell electric vehicle s also easier to recycle. So that is a plus and win-win for South Africa, as the calculations are done holistically.

Gericke: World Platinum this week sounded a warning that 2023 is expected to be a year of major platinum shortage.

Creamer: A massive platinum shortage is looming. It has been worsened by the loadshedding, which in mining terms is called load curtailment, because they actually curtail their smelters. At the same time, the outlook is that is going to be far less platinum. That has meant that the market has gone into contango, which means that the spot price of today is lower than the futures price of tomorrow. That is a very good position to be in, because this is creating a situation for investment in platinum again, which fell away quite badly, globally.

In that contango situation, people will look to go back into platinum as investors. Because of the emergence of hydrogen, there are certain circles now that also see platinum becoming an investment proxy for hydrogen, because you can't actually invest in hydrogen at this stage, but you can invest in platinum, which is joined at the hip to the hydrogen future. So that is another plus, even though there is a shortage, it is a plus, in that it ensures the position of platinum going forward, which is very important.

Gericke: South Africa’s electricity and rail threats must be turned into opportunities, says African Rainbow Minerals.

Creamer: This is a very important attitude to have. We have got so many threats at the moment that these business people sit there and they work out that this can be a major lucrative opportunity. So, that viewpoint is taking us into the green sector as well, because they are saying that the price of Eskom electricity has gone up 500% in 10 years, but if you come in with renewables, you actually can cut your costs incredibly.

That is one thing, but they know that the way they smelting at the moment is rather wasteful, and the different ways of smelting, so they can actually cut the energy quite substantially and do different forms of smelting, which are even more modern and better. The rail side is, of course, a very difficult one at the moment, but we are moving towards not using copper cabling but composite material, and if this composite material is stolen, and if it is them put in a smelter, as generally happens, they're gonna find there's no copper. So top business people are allowing themselves to get into a new era of opportunity, which will be very beneficial for South Africa's economy.

Gericke: Thanks very much. Martin Creamer is publishing editor of Engineering News & Mining Weekly.

Edited by Creamer Media Reporter




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