Platinum group metals (PGMs) and chrome miner Tharisa’s first-quarter production has set a steady foundation for the company for the rest of this financial year, despite external disruptions.

During the three months ended December 31, the company had mined 1.1-million reef tonnes and milled 1.2-million tonnes.

The PGM recovery rate was at 82.2% with production of 34.4-million ounces on a 6E – ruthenium, rhodium, palladium, osmium, iridium and platinum – basis, while the chrome recovery rate was 63.1%, with concentrate production at 34.2-million tonnes.

The three months saw a record PGM basket price at $1 406/oz, an increase of 16% over the prior quarter, and the average chrome price received for the quarter was $145/t, with a stripping ratio of 10.9 m.

However, external disruptions – such as unprecedented inclement weather and the electricity supply disruptions implemented by State-owned power utility Eskom – negatively impacted on production.

Tharisa CEO Phoevos Pouroulis on Friday said the company had, overall, achieved “a solid operational performance from mining and processing, leading to a stable quarter, despite the adverse impact of weather and the . . . power shortages”.

While Tharisa benefits from overall low use and stand-by capacity, he lamented that the unprecedented move to Stage 6 load-shedding in early December and consequent power reductions “did provide disruption to the processing plant’s stability”.

However, plant performance was “commendable”, Pouroulis said, adding that mining, accounting for the weather-related impact, was still in line with expectations.

Tharisa expects to achieve a build-up in output towards the latter half of the new financial year.

Across the border, in Zimbabwe, progress is continuing as planned. Mining reef tonnes milled totalled just over 1.1-million tonnes which, when compared with the previous comparable quarter in December 2018, was up 4.8% but lower than the quarter ended September 30, 2019.

Inclement weather also impacted on Tharisa’s Zimbabwe openpit operations, resulting in a run-of-mine “opportunity loss” of over 230 000 t.

Rainfall during December was 137% higher than the previously highest recorded rainfall in the past five years, and the lower reef tonnage has a direct impact on reef milled bust was up when compared to December 2018, at 1.2-million tonnes.

The stripping ratio improved against all measurements at 10.9 m.

Tharisa’s co-product business model has benefitted from record PGM prices, with the average PGM contained metal basket price for the quarter at $1 406/oz, with palladium and rhodium continuing to be the main driver of the increased basket price.

The average chrome price received for the quarter was $145/t with current spot trading at $133/t, levels the company believes are unsustainable in the long term; however, expectations are for chrome concentrate prices to remain at these levels during the current quarter, with some potential for improvement into the third quarter.

Further, Tharisa’s 2020 financial year production guidance remains at between 155 000 oz and 165 000 oz of PGMs on a 6E basis, and between 1.45-million tonnes and 1.55-million tonnes of chrome concentrate.

“The co-product model remains robust and we continue to enjoy the benefits of record PGM basket prices as we ramp up production in both PGM and chrome concentrates,” the company said on Friday.