Digging into the detail of platinum supply

With most of the major producers reporting numbers for the calendar year, we can now get a better idea of where the supply pain has been concentrated beyond the obvious headlines.  This also give us a much better idea of where to look in terms of what might change in 2013.

The chart above shows those operations which saw significant declines in 2012.  Its somewhat surprising that the Anglo Rustenburg operations did not suffer more than they did, while refined production from Lonmin wasn't as bad as expected following the terrible violence at the mine in 2H12. Implats had a terrible second half after a bad first half.

Some smaller operations also saw declines, like Crocodile River, while Xstrata's Elands operation is producing less and less.  Platinum output from Vale's Sudbury nickel operations seems to be suffering from a grade issue and its not clear how this will change.

Not all disappointments have come from falling production.  Anglo's Mogalakwena operation was only marginally behind 2011's performance, but this was against expectations of a solid gain.  Further increases have been pared back for next year.

Looking to next year not many are expecting operations to recover.  The Union mines have been projected to be in decline for sometime although that has been accelerated, while the full shut down of Khuseleka and Khomanani would take 200+ ounces out of next year, although implementation of Anglo's strategic review is currently being negotiated with stakeholders.

Either way, no one is banking on a huge recovery from current levels of production and this is increasingly looking the case for several years to come.

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