THE platinum price could gain as much as 80% over the next four to five years, said Bloomberg News citing Neal Froneman, CEO of Sibanye-Stillwater.
“Platinum has only just started to re-rate and it will continue,” Froneman said. “There is no reason why platinum will not eventually trade at $2,000 an ounce and probably even higher.” The metal has gained 30% in the past six months. Froneman said substitution of palladium with platinum in autocatalysts would help drive the metal’s price.
“Substitution has taken off very well in China and the regulatory environment there is a lot more flexible,” Froneman said. Platinum will be supported by its increasing use in hydrogen fuel cells, he said.
New technology developed by BASF SE – with backing from Sibanye and Impala Platinum – to partially replace palladium in autocatalysts could boost platinum demand by at least 300,000 ounces a year, Froneman told Bloomberg News.
Bloomberg News said Froneman had made bold price forecasts in the past including the one that stood behind the firm’s takeover of Stillwater Mining, a palladium dominant producer. At the time of the deal, Froneman was criticised for overpaying, but gains in the palladium price have since rewarded the risk.
Analysts think 2021 could be another good year for South Africa’s PGM producers with a reticence to build new projects behind the rush to secure metal supplies among customers, according to a Miningmx article.
RMB Morgan Stanley analysts, Christopher Nicholson, Brian Morgan, and Jared Hoover, forecast a 40% to 70% boost in the earnings of PGM producers this year and “a step up in cash returns to shareholders”.