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Platinum is entering the hyberbolic stage...where's the ETF?
FloridaBill
Posts: 896 ✭
Does anyone have a link to the ETF? Thanks!
FloridaBill
FloridaBill
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Wow just checked Kitco and on the world market it is up another $40 at $2091 Bid.
at least that's the way it used to work.....
FloridaBill
The ONLY ETF Platinum fund is based in London.....it's from ETF securities...BUT...it's not open to US citizens....
FloridaBill
Analysts say that even at this record level - up 32 percent in three weeks and double the price of two years ago - platinum is a good investment opportunity. Strong demand from the auto industry and an energy crisis in South Africa, the top producer of the metal, are expected to continue for months.
"Right now the ball is in the bulls' court and they can run with it and that's what they are doing," said David Holmes, director of metals sales at Dresdner Kleinwort. "They can continue driving prices until this whole move runs out of steam."
Spot platinum prices climbed to a record level for the 11th straight session, rising as high as $2,025 an ounce Thursday from its close of $1,985 in New York on Wednesday.
Strong commodity prices also drew investors into exchange traded funds, tightening a market that was already being squeezed.
Analysts expect the global platinum shortage to widen to between 400,000 ounces and 500,000 ounces by the end of 2008, up from 265,000 ounces in 2007 - mainly because of output losses in South Africa.
That forecast does not factor in disruptions that could occur this year from mining accidents and safety-related stoppages in South Africa. Such events happened often in the country last year.
"This is a supply shock of mammoth proportions," said Stephen Briggs, an economist at SG Corporate and Investment Banking. "We never saw anything like this before."
The market had a surplus of 65,000 ounces in 2006 after seven successive years of deficits.
A big part of the problem has been the power shortages in South Africa, which accounts for 80 percent of the global production of platinum.
The South African power utility Eskom, which supplies almost all of the electricity to the country, cut power to mines last month. Homes were also left in the dark and many shops had to close.
At the height of the crisis, mines were shut for five days. They are now getting 90 percent of their normal supply.
But the authorities say the crisis may last for up to four months, and supply troubles will linger for five years.
"Electricity is a problem in South Africa and it's going to stay like that for years to come," said Walter De Wet, a metals analyst at Standard Bank. "The situation is going to get complicated further as we are going to go into the winter, which will definitely see more electricity consumption."
Eskom's chief executive, Jacob Maroga, said Thursday that the company would consider buying back "significant" amounts of surplus power from industrial customers as it tried to reduce pressure on its strained power grid.
Still, Anglo Platinum, the world's top producer, said that power problems alone would cut output by 120,000 ounces in 2008, and had reduced output by 30,000 ounces since January. Flooding last month at its second-largest mine would cut a further 60,000 ounces.
Impala Platinum, the world's second biggest producer, said its output in the fiscal year ending June 30 would fall to just under 2 million ounces, from 2.026 million in 2007.
Last year, Angloplat launched a safety campaign, which shut its operations temporarily. The authorities also ordered temporary shutdowns every time a worker was killed at South African mines. A total of 25 workers died at Angloplat's mines last year.
Production at Northam Platinum fell 16.5 percent to 150,755 ounces in the first half to December, because of accident-related stoppages that led to production cuts for 23 days.
At the same time, demand is growing, largely from the auto industry and concerns over climate change.
Nearly two-thirds of the demand for the metal is used in making catalytic converters, a pollution-control device. That demand has soared 135 percent in nearly a decade, to 4.24 million ounces last year.
The auto industry has no choice but to pay the higher price - passing it on to consumers - because of growing vehicle production and pressure to reduce greenhouse gas emissions.
"You know that platinum demand is increasing on the back of emission controls and you know that supplies are going to be squeezed," De Wet said. "It just makes sense to be long in this market."
Global demand for jewelry, another industry that uses platinum, fell 1.5 percent to 1.595 million ounces in 2007 from a year earlier. "In the end, what you need is higher supply and you need that urgently. But that just doesn't seem to be coming through at the moment," said Michael Widmer, an analyst at Lehman Brothers. "You need the producers to produce more to rebalance the market."
<< <i>While I agree with the general assessment, the statement " big part of the problem has been the power shortages in South Africa, which accounts for 80 percent of the global production of platinum" is cleary incorrect. Actually the US is the biggest platinum supplier with Russia next. If SA was the biggest then platinum would be $10,000/oz about now. Good article though. >>
Right on the money!! For deposits, or holdings!!
<< <i>Actually the US is the biggest platinum supplier with Russia next. If SA was the biggest then platinum would be $10,000/oz about now. >>
WOW! If this is true, you may be correct. Could you possibly supply a link verifying that the US is the supply for over 50% of the world's platinum?
On the other hand, if it is in fact correct the South Africa supplies over 80% of the worlds platinum, what is your time frame for $10,000 platinum?
FloridaBill
<< <i> I have heard of some very nice plat gift givers last holiday season. Wow, talk about the gift that keeps giving. >>
I hadn't even thought about that...I remember hearing something like that also....
Isn't it amazing what a little "bread upon the waters" will do.....
FloridaBill
carry on
<< <i>The major primary deposits of platinum are in the United states, South America, South Africa, Commonwealth of Independent States (especially in Russia) and Canada. South Africa and Russia are two major producers. South Africa's Merensky Reef currently supplies about 60% of the world's platinum. About 8.3 million ounces of the platinum group metals were mined in 1992. Only about 3.8 million ounces of that was platinum itself. On the other hand, some 50 million ounces of gold are mined each year and almost 400 million ounces of silver. As you can see that's more than ten times as much gold in a given year as platinum and 100 times more silver. Relative scarcity is one reason the platinum group metals are so valuable. >>