PGM “challenges” do not incentivise production growth – Amplats CEO, Chris Griffith

Chris Griffith, CEO, Gold Fields

ANGLO American Platinum (Amplats) was not tempted to consider expanding production despite having restructured itself into profitability, a development heavily assisted by the improvement in the rand basket of platinum group metals (PGMs).

“There are enough challenges in the industry still for us to not lose our heads and to think everything is sunshine and roses,” Amplats CEO, Chris Griffith, told the Financial Mail when asked if production expansion was on the cards.

“We’ve been working very hard to focus on value and not volume … [but] I don’t think the industry has weaned itself off that mentality yet; we’re still seeing some producers talking about increasing production,” he said.

However, Amplats had the ability to grow as it owned about 40% of the world’s PGM resources. “We have resources to still grow the company,” he said. “What we’ve got to be very careful about is watching market demand, as opposed to just growing because we can,” he said.

Amplats said in a first quarter production report in April that refined platinum production decreased by 18% to 411,700 ounces and refined palladium production decreased by 8% to 293,600 oz. Platinum sales volumes decreased by 14% to 414,200 oz and palladium sales volumes decreased by 11% to 292,100 in line with refined production.

Production guidance for the 2019 financial year remained unchanged at between two and 2.1 million oz of platinum and 1.3 to 1.4 million oz of palladium.

Amplats is currently participating in an all-action second quarter as wage talks have kicked off with unions including the rumbustious Association of Mineworkers & Construction Union.