Platinum supply from Zimbabwe is estimated to decrease by 5% year-on-year (-25 000 ounces), with mine production stable at 455 000 ounces.
According the World Platinum Investment Council first quarter report no major pipeline stock movements is expected.WPIC said a potential lock-up in the pipeline owing to ongoing processing reconfiguration work could see Russian supply fall by 9% (-65 koz) to 660 koz in 2018.
However, ramp-up of output from new production areas at existing operation in North America should see yield in this region increase by 3% year-on-year (+10 koz) to 375 koz. Other supply is stable at 185 koz.
An increase in producer inventory of 20 koz is forecast, bringing total mining supply to 6,015 koz (-3% year-on-year).WPIC said global supply is forecast is however to fall by -1.8% year-on-year (-110 koz) to 6,035 koz in 2018.
South African production is estimated to drop by -1% (-30 koz) to 4,355 koz.
Shafts in ramp-up phase are scheduled to add around 105 koz this year, but last year’s mine
closures and pipeline lock-up from a furnace outage mean refined production will be lower overall compared to 2017.
“Compared to last quarter, projected South African output in 2018 has been revised up to take account of a more stable production environment and producers’ efforts to maximise mining and processing efficiencies in response to low platinum prices,” said WPIC.
Global demand of platinum was 1,975 koz in the first quarter of the year, down marginally (-10 koz) year-on-year as gains in jewellery (+30 koz) and industrial (+15 koz) demand were outweighed by declines in automotive (-35 koz) and investment demand (-20 koz).
Total supply rose 4% (+75 koz) year-on-year to 1,850 koz as both primary and secondary supply increased.
“The first quarter typically sees weak output from South Africa, but an improvement in output from Russia resulted in global refined production falling 10 koz and, unlike Q1’17, there was not a significant build in producer inventory, so overall total mining supply increased by 3% to 1,400 koz,” said WPIC.
The resulting market balance was a deficit of 125 koz.