Southern African expansions set to meet growing platinum ... · 3 5 Platinum demand Automotive...
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1 PDAC March 2004 Bob Gilmour Southern African expansions set to meet growing platinum demand 2 Overview • Historical platinum and palladium demand and supply • Outlook for platinum demand • How growing platinum demand will be met?
Transcript of Southern African expansions set to meet growing platinum ... · 3 5 Platinum demand Automotive...
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PDACMarch 2004
Bob Gilmour
Southern African expansions set to meet growing platinum demand
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Overview
• Historical platinum and palladium demand and supply
• Outlook for platinum demand
• How growing platinum demand will be met?
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Historical platinum and palladium demand and supply
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Automotive• Spread of emission legislation and adoption of stricter
standardsEmission Limits (g/m)
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
N0x Carbon Dioxide/10 Non-Methane Organic Gases (Hydrocarbons)
Tier 1 NLEV
Platinum demand
3
5
Platinum demand
Automotive (cont)• Diesel share of European new car sales
20
25
30
35
40
45
50
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
%
Source: Schmidt
6
Platinum demand
Total Automotive demand
0
500
1,000
1,500
2,000
2,500
3,000
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
‘000 oz
4
7
Platinum demand
Jewellery• Consumer desire for
white metal
8
Platinum demand
Jewellery (cont)• New markets
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
2,000
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
China North America
‘000 oz
5
9
Platinum demand
‘000 oz
0
500
1,000
1,500
2,000
2,500
3,000
3,500
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
Jewellery
10
Platinum demand
Other
• Industrial
• Expanding applications
• Economic growth
• Investment
• Price sensitive
6
11
‘000 oz
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
Other
Platinum demand
12
‘000 oz
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
Automotive Jewellery Other
Platinum demand
7
13
Southern Africa• South African expansions• Emergence of Zimbabwe
‘000 oz
2,000
2,500
3,000
3,500
4,000
4,500
5,000
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003South Africa Zimbabwe
Platinum supply
14
Russia
• Sales erratic
0
200
400
600
800
1,000
1,200
1,400
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
Russian Sales
‘000 oz
Platinum supply
8
15
Secondary• Increase in recycling
0
100
200
300
400
500
600
700
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
‘000 oz
Platinum supply
16
‘000 oz
0
50
100
150
200
250
300
350
400
450
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
North America• Combination of primary and by-product output
Platinum supply
9
17
Global supply‘000 oz
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
Southern Africa North America Recycle Russia Zimbabwe Other
Platinum supply
-800
-600
-400
-200
0
200
400
600
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
0
100
200
300
400
500
600
700
Balance $/oz
‘000 oz $/oz
Platinum supply/demand balance
18
10
19
Automotive• Legislation• Substitution for platinum
0
0.02
0.04
0.06
0.08
0.1
0.12
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
oz per vehicle
Palladium demand
20
‘000 oz
0
1,000
2,000
3,000
4,000
5,000
6,000
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
Automotive
Palladium demand
11
21
Electronics
• Substitution by nickel in MLCC’s
0
10
20
30
40
50
60
70
80
90
100
1997 1998 1999 2000 2001 2002 2003
%
Palladium demand
22
‘000 oz
0
500
1,000
1,500
2,000
2,500
3,000
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
Electronics (cont)
Palladium demand
12
23
Other
Palladium demand
‘000 oz
0
500
1,000
1,500
2,000
2,500
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
24
‘000 oz
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
Automotive Electronics Other
Palladium demand
13
25
‘000 oz
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
Other South Africa North America Recycle Russian Sales
Palladium supply
-1,000
-500
0
500
1,000
1,500
2,000
2,500
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
0
100
200
300
400
500
600
700
800
Balance $/oz
‘000 oz $/oz
Palladium supply/demand balance
26
14
27
Outlook for platinum demand
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Outlook for platinum demand
Automotive• Adoption of stricter legislation
Emission Limits (g/m)
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
N0x Carbon Dioxide/10 Non-Methane Organic Gases (Hydrocarbons)
Tier 1 NLEV Tier 2
15
29
Automotive (cont)
• Ongoing expansion of light duty diesel market
• New legislation covers heavy duty vehicles –mainly diesel
• Growth in rest of world vehicle sales
Outlook for platinum demand
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Outlook for platinum demand
Jewellery
• Resilient market underpinned by strong consumer demand
• New market development
• India
• South East Asia
• Middle East
• Bridal
16
31
Fuel cells • Commercialisation
starting
Outlook for platinum demand
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Automotive Jewellery Other
‘000 oz
Platinum demand
32
17
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by Southern African expansions
How will growing platinum demand be met?
South Africa/Zimbabwe operations
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18
Bushveld ComplexSouth Africa – existing operations
Impala
MarikanaKroondal
RPMRasimone
AmandelbultUnion
PP Rust
Lebowa
Modikwa
Lonmin
Northam
ImplatsAngloPlat
Lonmin
Aquarius
Other
Messina
35
Ramp-up, pre-production
Awaiting approval
Union
RPM
Kroondal
MarulaTwickenham
Lonmin Everest SouthStyldrift
Pandora
Two RiversDer Brochen
Bushveld ComplexSouth Africa – expansion projects
36
19
Makwiro
Mimosa
Implats/Zimplats
Implats/AQP
Great DykeZimbabwe – existing operations
37
Unki
Pre-production
Great DykeZimbabwe – expansion projects
38
20
‘000 oz
2,000
2,500
3,000
3,500
4,000
4,500
5,000
5,500
6,000
6,500
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
South Africa Zimbabwe
Southern African platinum supply
39
Exploration
Bushveld ComplexSouth Africa – expansion projects
40
21
Makwiro
Mimosa
Feasibility study Exploration
Great DykeZimbabwe – expansion projects
41
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Southern Africa ROW
‘000 oz
Global platinum supply
42
22
Platinum supply/demand balance
-800
-700
-600
-500
-400
-300
-200
-100
0
100
200
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
‘000 oz
43
44
Automotive
• Legislation
• Substitution of platinum
Electronics
• Ongoing miniaturisation and thrifting
Outlook for palladium demand
23
45
Palladium demand
0
2,000
4,000
6,000
8,000
10,000
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Automotive Electronics Other
‘000 oz
46
Palladium supply
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Other Southern Africa Russia North America Recycle
‘000 oz
24
Palladium supply/demand balance
-1,000
-500
0
500
1,000
1,500
2,000
2,500
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
‘000 oz
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Conclusion
Platinum
• Fundamentals remain firm
• Growing demand met by Southern African expansions
Palladium
• Increasing demand in automotive industry and new
applications provide positive longer term outlook
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