JOHANNESBURG (miningweekly.com) – The long-awaited depletion of Russia's stocks of palladium was now at hand, which was set to boost the palladium price as well as African Rainbow Minerals' (ARM's) palladium-rich mines, Arm CEO André Wilkens told Mining Weekly Online on Monday.
Speaking at question time following the presentation of Arm's annual results of 42% lower headline earnings to R2,3-billion, Wilkens said that Norilsk of Russia, which ARM partnered in nickel in South Africa, was currently down to its normal monthly levels of palladium production.
"I have met with four of their senior directors in the week and they've assured me that they have no stockpile of palladium. They only have normal production in the pipeline," Wilkens told Mining Weekly Online.
Impala Platinum marketing executive Derek Engelbrecht called an end to Russian palladium destocking on Friday, but cautioned about a residue of Russian palladium in Zurich, which remained in bond and unpriced.
Engelbrecht expected palladium to be in deficit when developed-world car sales takeoff, combined with Asian growth and thrifting into palladium.
"China is a gasoline market, as is India, and they are using predominantly palladium catalysts and those markets are growing," Engelbrecht pointed out to Mining Weekly Online.
The Russian stockpile has been one of the main palladium price inhibitors, to the detriment of new platinum mines on the Bushveld Complex's eastern limb, which are palladium rich.
Engelbrecht said that the palladium price was approaching $300/oz after being as low as $150/oz, but was not expected to return in the near term to its heady level of $1 000/oz at the start of the decade.
Said Wilkens: "There is no doubt that we are going to see - in the near future and in time to come - a more competitive price for palladium, and our mines that sit on the eastern limb are well positioned to benefit from that, because almost 50% of their product is palladium."
Arm Platinum partners Impala Platinum at the Two Rivers mine, which produced 246 295 oz of platinum-group metals (PGMs) in the year ended June 30, and also partners Anglo Platinum at Modikwa, which produced 348 866 oz of PGMs.