Thursday 19th September 2019

Resource Clips


Posts tagged ‘pgm’

A head start

April 14th, 2016

Nickel One Resources builds on past work at western Ontario’s Tyko project

“Not too many properties come to you with two discoveries already drilled but never released,” says Nickel One Resources TSXV:NNN president/CEO Vance Loeber. “These results had never seen the light of day in a public company.”

He’s referring to the Tyko project in western Ontario’s Thunder Bay mining district, where Nickel One recently completed a program of confirmation drilling. Initial results have the company optimistic about its nickel-copper-PGM potential, and in particular about the possibility that two zones might be one.

Nickel One Resources builds on past work at western Ontario’s Tyko project

Still to come from Tyko are results from 10 more winter holes.

The project came to Nickel One with the advantage of two seasons of drilling by North American Palladium TSX:PDL back in 2006 and 2007. Focusing on its Lac des Iles operation and advanced projects in Ontario and Finland, the company let Tyko revert to its vendors, friends of Abraham Drost, now Nickel One’s chairperson.

Loeber and Drost had worked together in prominent roles on a number of projects including Sandspring Resources TSXV:SSP and Carlisle Goldfields, the latter taken over by Alamos Gold TSX:AGI earlier this year. Consequently Nickel One’s predecessor, Redline Resources, acquired the privately held Tyko Resources and its namesake project, then began trading as Nickel One at the end of February.

North American drilled 2,230 metres in 13 holes, finding mineralization in nine of them. Redline’s February 2015 43-101 technical report provides highlights from those two programs, including:

Hole TK-06-001 at the Tyko showing

  • 1.09% nickel, 0.76% copper, 0.42 ppm platinum and 0.42 ppm palladium over 4.15 metres, starting at 17.4 metres in downhole depth

TK-06-003 at the RJ showing

  • 1.06% nickel , 0.51% copper, 0.24 ppm platinum and 0.12 ppm palladium over 4.08 metres, starting at 63.92 metres

TK-06-005 at the RJ showing

  • 1.05% nickel, 0.46% copper, 0.2 ppm platinum and 0.12 ppm palladium over 6.2 metres, starting at 25 metres

True widths weren’t available.

Having raised $890,000 about a week after its February trading debut, Nickel One dispatched a rig to confirm the results. Assays for the first four holes came out April 12, with one near-surface interval from the RJ zone nearly matching the previous best grade while exceeding its width nearly four-fold—1.04% nickel over 16.19 metres.

That result appeared within a longer interval of 0.79% nickel over 44.12 metres:

  • 0.79% nickel, 0.3% copper, 0.01 ppm gold, 0.12 ppm platinum and 0.11 ppm palladium over 44.12 metres, starting at 52.75 metres in downhole depth

  • (including 1.04% nickel, 0.54% copper, 0.01 ppm gold, 0.12 ppm platinum and 0.12 ppm palladium over 8.25 metres

  • (which includes) 2.89% nickel, 0.45% copper, 0.01 ppm gold, 0.27 ppm platinum and 0.35 ppm palladium over 0.5 metres

  • (and including) 1.04% nickel, 0.23% copper, 0.15 ppm platinum and 0.12 ppm palladium over 16.19 metres

  • (which includes) 1.23% nickel, 0.26% copper,0.18 ppm platinum and 0.13 ppm palladium over 11.38 metres

  • (which includes) 1.97% nickel, 0.19% copper,0.17 ppm platinum and 0.12 ppm palladium over 1 metre

Again, true widths weren’t available. Results are pending for 10 more holes from the 14-hole, 1,780-metre program.

Summer drilling will test a theory that the RJ and Tyko zones, 1.5 kilometres apart, might be linked. The earlier drilling, magnetics, electromagnetics and IP surveys led to the 43-101’s conclusion that the property has been intruded by a mafic to ultramafic conduit that’s interpreted to be a feeder system. A “major structural flexure” between the RJ and Tyko zones coincides with anomalous nickel, copper and PGEs.

“The property shows many similarities with mafic to ultramafic feeder systems such as Voisey’s Bay in northern Labrador and Jinchaun in China,” the report states. “These deposits are characterised by magmatic sulphides collecting within the feeder of a large intrusive body due to variations in geometry that caused changes in flow dynamics such that immiscible sulphides were able to settle out and collect in structural traps.”

A concentration of immiscible sulphides is key to the formation of an economic nickel deposit, the report adds.

Having taken over the Nickel One helm just weeks ago, Loeber’s enthusiastic about renewing his collaboration with Drost and working with their new teammates. Among them is adviser Glenn Mullan, whose 35-year exploration/mining career includes his current role as president/CEO of Golden Valley Mines TSXV:GZZ. Director Scott Jobin-Bevans, with more than 22 years of exploration experience, wrote his PhD thesis on PGE mineralization in Ontario.

Accessible by logging roads and float plane, the 11,168-hectare property sits about 40 kilometres north of Hemlo and 28 kilometres southeast of the town of Manitouwadge, at the north end of Highway 614.

Anxious to get back, the company plans to resume drilling after spring breakup, Loeber says. Meanwhile the rig remains onsite, making it cheaper and quicker to renew the attack.

Group Ten Metals completes Yukon field program, expands PGM-nickel-copper turf

March 1st, 2016

by Greg Klein | March 1, 2016

Still growing its northern presence, Group Ten Metals TSXV:PGE has staked additional ground for the Spy project in southwestern Yukon. That increases the platinum group metals-nickel-copper property by 1,250 hectares to total 3,135 hectares, the company announced February 29.

Group Ten Metals completes Yukon field program, expands PGM-nickel-copper turf

Assays are pending from a sampling program
on Group Ten Metals’ expanded Spy property.

Group Ten optioned 100% of the first claim block in September for 1.05 million shares over three years and a 3% NSR. With funding assistance from the Yukon government, the company then conducted silt and rock sampling, prospecting, mapping and reinterpretation of previous geophysics. Once assays arrive, they’ll be integrated with the geophysical reinterpretation to define targets for trenching and possibly drilling.

Historic, non-43-101 grab samples returned grades as high as 75.8 grams per tonne platinum, 7.9 g/t palladium, 7 g/t gold, 2.6% nickel and 10.45% copper, Group Ten reported.

Spy comprises one of three road-accessible Group Ten projects in the 600-kilometre-long Kluane Ultramafic Belt, stretching from northern British Columbia through the Yukon into southern Alaska. Roughly 40 kilometres north of Spy sits Group Ten’s flagship Catalyst project, which borders on three sides the Wellgreen PGM-nickel project, where Wellgreen Platinum TSX:WG completed a preliminary economic assessment last year. Group Ten’s Ultra project sits south of Spy.

In September the company also picked up the Duke Island copper-nickel-PGE project on the Alaska Panhandle for two million shares and a 1% NSR. In western Ontario Group Ten holds the Black Lake/Drayton gold project.

Infographic: The world’s most valuable substances by weight

January 12th, 2016

Text by Jeff Desjardins | Graphic by BullionVault

The world’s most valuable substances by weight

In the field of economics, the laws of supply and demand state that the price of a product and its available supply to the market are interconnected. For example, if a good such as crude oil is produced in excess, the price will drop accordingly.

However, sometimes substances are nearly impossible to produce in the first place—and that means that it can be extremely difficult for the market to respond to increases in demand. The world’s most valuable substances generally fall into this category and this makes their value per gram very high.

White truffles, for instance, only grow for a couple of months of the year, almost exclusively in one part of Italy. They must be foraged by special pigs, and they seem to be worth more every year. The price per gram for white truffles is $5, which means that a pound costs close to $2,000.

Despite this, white truffles barely crack the list of the most valuable substances by weight.

Saffron, a spice that is gathered from the flower of the crocus sativus plant, is another notch higher on the list. To get one pound of dry saffron requires the harvest of 50,000 to 75,000 flowers. There’s only 300 tonnes of production each year, and that annual production is worth around $3 billion.

Higher up on the list of the world’s most valuable substances are some familiar metals. Silver does not make the list, as it is only worth around $0.50 per gram. However, many of the platinum group metals (PGMs) do make the list: platinum, palladium, rhodium and iridium all range between $16 and $27 per gram. Gold also makes the list, and it has traded for more than an ounce of platinum since early 2015. One gram of gold is worth just under $34.

At the top of the list we find a combination of extremely rare metals, radioactive isotopes and gemstones.

The radioactive element californium, first made in 1950, is the most valuable at $27 million per gram. It is one of the few transuranium elements that have practical applications, being used in microscopic amounts for metal detectors and in identifying oil and water layers in oil wells.

Diamonds are near the top of the list as well at $65,000 per gram, though like many other gemstones, the value depends on the specific crystal in question. Many industrial diamonds are relatively cheap, but the rarest and most beautiful stones can be worth millions.

Iranian beluga caviar and crème de la mer are the most expensive non-metals or non-gemstones on the list. Iranian caviar is made from the roe of beluga sturgeons found in the Caspian Sea, and it is valued at about $35 per gram. Crème de la mer was originally created by a physicist for NASA to heal his burns, but it is now sold as a face cream by Estée Lauder for $70 per gram.

Graphic by BullionVault / Posted with permission of Visual Capitalist.

Final tranche closes on Equitas Resources’ $2-million private placement

September 18th, 2015

by Greg Klein | September 18, 2015

Equitas Resources’ (TSXV:EQT) Garland nickel project in Labrador received another $967,660 in the second and final tranche of a private placement totalling $2 million, the company announced September 18.

Final tranche closes on Equitas Resources’ $2-million private placement

Both veterans of Voisey’s Bay, Equitas VP of exploration Everett Makela and consulting geologist Dan Lee at the Garland base camp.

Combined, both tranches comprised 3.16 million units and 17.03 million flow-through units. Each unit consists of one share and one warrant. Each flow-through unit consists of one share and one-half warrant, with every whole warrant exercisable for a share at $0.20 for 12 months.

Warrants exercised over the last month brought Equitas another $197,000.

The funding comes as exploration continues on Garland, a recently compiled property 30 kilometres south of Voisey’s Bay that underwent modern exploration for the first time with last year’s VTEM Plus airborne surveys. That program found nine areas of anomalous conductivity prospective for Voisey’s-style mineralization, most of them at the limit of, or well beyond depths reached by historic geophysics.

Now underway, Phase II calls for up to 30 line-kilometres of large loop UTEM 3 surveys and up to 4,000 metres of drilling.

Read a field report from the Garland project.

Read more about Equitas Resources.

Report from the field

September 15th, 2015

A first-hand look at Equitas Resources’ quest for Labrador nickel

by Sean Kingsley

The September 15 announcement that Equitas Resources TSXV:EQT closed a private placement first tranche of $1.03 million followed a report from the field by corporate communications manager Sean Kingsley. After a three-day trip from Vancouver, Kingsley arrived at the Garland nickel project in Labrador sans luggage, thanks to Air Canada, but brimming with enthusiasm. He provides this account.

 

Some know this of me and I always thought it of myself since I was young—I am extremely scared of heights. During lift-off on the trips to Toronto, Asia and Europe I chew at least three pieces of gum, pop an Ativan and hold onto the armrests. Once in the air I need ginger ale mixed with something stronger. I don’t do well on planes but after the four rides in different-sized planes and a few helicopter rides I’m more than eager to get out to the field to explore Equitas’ Garland property.

Report from the field: Equitas Resources’ quest for Labrador nickel

Sean Kingsley braved phobia, bug bites and back country backpacking to get a first-hand look at Garland.

A couple days ago I spent a whole shift out in the rolling hills, cliffs and bushes with Crone, the geophysical crew. There were seven of us that split up into three groups. I got to traverse the lay of the land with geophysicists Eldon Roul and Ryan Metcalfe. Jeremy Haak and Nick MacKay were set up on the hill to our left. Plan of attack would be to head straight down and across with the GPS until we reached another team or destination. Through tree branches, cliffs, hills and bushes the goal was to keep the line as straight as can be.

Most of these guys have spent time in many different nickel camps which include the Raglan, Norilsk, Thompson and over in Greenland, but these hills were a whole ’nother event for them. Not to mention on their backs were harnesses packed with 400 metres of 10-gauge lines which weighs in about 50 pounds each. I attempted to start off with harnessing myself up with a line pack but opted into carrying the 40-pound lunch-and-survival backpack.

You can’t see the other team across the valley but William Decker (Nain, Labrador) and Caley Loft had the challenge of going down a near 60-degree cliff. Not only that, they could only carry one harness spool, so once their 400 metres ran out they had to backtrack for more line.

Report from the field: Equitas Resources’ quest for Labrador nickel

The terrain is rough but the country’s spectacular—and it might yield riches.

Exploration work is not an easy job. I have a new-found level of respect for all that work in mineral exploration camps worldwide.

When I get back to the office I’ll upload some GoPro videos of us bushwhacking straight across the valleys and cliffs. Internet reception is limited and has not been our camp’s best friend so we try to conserve usage. Where we got dropped off is where the transmitter will stay for a couple days for them to do the surveys once the loops are completed. Once the data is collected it gets sent over to the Crone office in Ontario where they compile it completely. Then EQT sends it over to our consulting geophysicist Alan King.

Little note here: I’ve been re-reading the book The Big Score (the tell-all story of the Robert Friedland, Inco and Voisey’s Bay story) while up here in the Big Land and have come across several names of individuals who were a big part of its developments that are now a part of our developments. Before Inco committed to go forward with a minority stake of 25% in Friedland’s Diamond Fields they wanted to make sure the Voisey’s high-grade nickel discovery was for real. They sent in their Operation Green Team, which was made up of conservative geologist Ed Pattison and two men from Inco’s Engineering Building, Alan King, manager of geophysics, and Paul Golightly, a senior research geologist. It was their job to be as skeptical as possible.

Report from the field: Equitas Resources’ quest for Labrador nickel

Geophysicists don’t pack light. Luckily, this crew didn’t rely on Air Canada.

Sure enough, after their thorough site visit they reported back to Inco’s Michael Sopko that it was the real deal. At the time they could only estimate that Voisey’s Bay held 10% more than Diamond Fields’ estimated 25 million tonnes. To date we know Voisey’s totalled 141 million tonnes.

There’s quite a few camp personnel here who have worked at Archean Resources, Voisey’s Bay, Inco, Vale and also on projects of great success. All of us here at camp have gotten along tremendously and are hoping and praying that the drillers come in and prove Equitas’ theory. In the meantime I’m hoping Canadian Helicopters’ HQ will give approval to strap the GoPro camera onto the outside of the helicopter so we can do a property fly-over. Crossing my fingers.

P.S.: If you get to make your way up to camp, make sure you bring a bug jacket. There be bugs in dem hills!

Read more about Equitas Resources.

 

South of Voisey’s Bay

March 25th, 2015

New developments put Equitas Resources in search of a nearby nickel discovery

by Greg Klein

Next Page 1 | 2

The greatest find of Canada’s first diamond rush failed to locate a single gemstone. Instead Robert Friedland’s Diamond Fields Resources stumbled onto nickel with cobalt and copper—much more prosaic stuff but in such magnificent quantities that, just three years after its 1993 discovery, Voisey’s Bay sold for $4.3 billion. Yet the Labrador region remains under-explored. Now, with the advantages of new technology plus single ownership of a recently compiled land package, Equitas Resources TSXV:EQT puts new impetus into the search for a second deposit.

Just 30 kilometres south of Voisey’s, the company’s 25,050-hectare Garland project came together after two years of research by Dahrouge Geological Consulting. According to Equitas VP of exploration Everett Makela, this puts the “most prospective area outside of the Vale mine property” under a single operator for the first time, a significant advantage for effective exploration.

New developments put Equitas Resources in search of a nearby nickel discovery

Despite its proximity to Voisey’s, patchwork ownership
and outdated methods left the region under-explored.

This, in an area where deposits could come in clusters. That’s the case for major nickel camps like Sudbury, Norilsk, Thompson and Raglan, Makela emphasizes. Therefore “the likelihood of discovering more Voisey’s Bay-type deposits in the region is high.” But if that’s so, why has the area been neglected?

“The reality is that, after 20 years of exploration by scores of companies combing the surface, the remaining prospective environments are buried,” he explains. “In the case of the Garland project, that is most likely under younger cover rocks. Voisey’s Bay itself was exposed by a fortunate erosional history. It takes a strong commitment to advance the next stage. Commitment to exploring the deeper sub-surface requires insight into critical elements of the mineralizing process and employment of state-of-the-art geophysical methods.”

State-of-the-art exploration is already underway at Garland, where a VTEM-plus survey began in February. Previously some 10 separate companies explored relatively small pieces of the current Garland project with now-outdated electromagnetic surveys that penetrated only to about 75 metres. Equitas’ regional-scale geophysics can reach a maximum 10 times that depth, all the better to detect large, highly conductive nickel sulphide deposits.

As for insight, Makela brings Equitas solid expertise. The Sudbury native began his career in 1981 as a geological assistant with pre-Vale Inco. By the time he retired in 2012, Makela was Vale’s principal geologist for North America. “I’ve worked alongside some of the leading experts in nickel exploration and benefited greatly from access to the resources of leading global nickel companies,” he says. “My experience spans the gamut from target generation through to resource definition.”

He’s worked in the U.S., Mexico, Greenland, South Africa and Brazil, along with “years of focus on Sudbury and Voisey’s Bay that gave me a strong background in world-class mineralized systems and the business of building mines.” In fact Makela served on the Inco team that conducted initial due diligence prior to the multi-billion-dollar Voisey’s acquisition.

So what does he see at Garland? Well, enough of what he saw at Voisey’s to stoke his enthusiasm.

“Aside from having the same favourable address, along an Archean-Proterozoic boundary, Garland and Voisey’s share a remarkable number of geological signatures,” he points out. “Both are located at the intersection of a regional-scale east-west corridor of faults with a northeast-trending fault set. The combined movement is likely to have caused the open space that allowed emplacement of the Voisey’s Bay ores. That’s the same style of structural offset that we believe we have on our own property. Magnetic signatures and interpreted structural deformation are very similar.

Next Page 1 | 2

July 7th, 2014

Are we close to peak coal in China? VantageWire
The Corbett Report video: The history of the Federal Reserve GoldSeek
David H. Smith: PGMs will lead the charge of the bulls Streetwise Reports
Oilfield Minerals Outlook Houston: The shale gale continues Industrial Minerals
Former Canaccord broker sanctioned by IIROC, agrees to pay $35,000 Stockhouse
Elephants in the Nevada desert: Carlin-type gold deposits Geology for Investors
The beginning of bank seizures Equedia

EU names six new critical materials, warns of industry challenges

May 26th, 2014

by Greg Klein | May 26, 2014

Six new critical raw materials bring the European Commission’s list up to 20, posing a “major challenge for EU industry,” the EC announced May 26. An update to the original 2011 collection, the set now includes borates, chromium, coking coal, magnesite, phosphate rock and silicon metal. No longer included is tantalum, now considered to have a lower supply risk. The division of rare earths into two categories, light and heavy, brings the total to 20 materials:

Raw materials are everywhere—just consider your smartphone. It might contain up to 50 different metals, all of which help to give it its light weight and user-friendly small size. Key economic sectors in Europe—such as automotive, aerospace and renewable energy—are highly dependent on raw materials. These raw materials represent the lifeblood of today’s industry and are fundamental for the development of environmental technologies and the digital agenda.—EC Enterprise and Industry

  • antimony
  • beryllium
  • borates
  • chromium
  • cobalt
  • coking coal
  • fluorspar
  • gallium
  • germanium
  • graphite (natural)
  • indium
  • magnesite
  • magnesium
  • niobium
  • phosphate rock
  • platinum group metals
  • rare earths (heavy)
  • rare earths (light)
  • silicon metal
  • tungsten

With 54 candidates considered, materials were evaluated largely on two criteria, economic importance and supply risk. Economic importance was determined by “assessing the proportion of each material associated with industrial megasectors” and their importance to the EU’s GDP.

Supply risk was assessed through the World Governance Indicator, which considers factors “such as voice and accountability, political stability and absence of violence, government effectiveness, regulatory quality, rule of law or control of corruption.”

Not surprisingly, the report names China as the biggest global supplier of the 20. “Several other countries have dominant supplies of specific raw materials, such as Brazil (niobium). Supply of other materials, for example platinum group metals and borates, is more diverse but is still concentrated. The risks associated with this concentration of production are in many cases compounded by low substitutability and low recycling rates.” About 90% of the critical materials’ primary supply comes from outside the EU.

The commission hopes its list will encourage European production of the materials. The list will also be considered when negotiating trade agreements and promoting R&D, as well as by companies evaluating their own supplies.

As for the future, the EC sees growing demand for all 20 critical raw materials, “with niobium, gallium and heavy rare earth elements forecast to have the strongest rates of demand growth, exceeding 8% per year for the rest of the decade.”

The commission adds that “all raw materials, even when not critical, are important for the European economy” and therefore should not be neglected.

The EC intends to update its list at least every three years.

Download the EU report on critical raw materials.

Q3 winning streak over: “Considerable underperformance” among Canadian miners in Q4

February 6th, 2014

by Ana Komnenic | February 6, 2014 | Reprinted by permission of MINING.com

Canadian mining stocks experienced a 45% decrease in market capitalization in 2013, with the last quarter alone showing a 9% drop, according to Ernst & Young’s Canadian Mining Eye Q4 2013 report.

It’s well known that concerns over global economic growth and uncertainty over what the U.S. Federal Reserve would do next dragged down commodity prices, leading companies to write down assets and cut costs.

But, despite some mild improvements in the third quarter, last quarter of 2013 unfolded much like the rest of the year—poorly.

The Canadian Mining Eye index—which tracks the performance of 100 TSX and TSXV mid-tier and junior companies with market capitalizations between $1.4 billion and $55 million in Q3—shed 9%. The preceding quarter the index rose by 5%.

“This indicated a considerable underperformance relative to the S&P/TSX Composite index that gained 7% in the fourth quarter,” according to the report.

Q3 winning streak over: “Considerable underperformance” among Canadian miners in Q4

Chart from Canadian Mining Eye Q4 2013, Ernst & Young

 

By commodity group, the only winners were among the diamond, platinum group metals, and coal and consumable fuels sectors.

The gold and fertilizer minerals sectors were hit the hardest; gold dropped 27% over the year and the potash industry was crushed by the breakup of the Russian-Belarusian potash cartel in July.

As for individual companies, Colossus Minerals TSX:CSI is the index’s biggest loser; the company experienced a net share price decline of 91% during the quarter.

One-third of the companies tracked by the Canadian Mining Eye index realized a net gain in the fourth quarter, compared with more than half in the third quarter.

Lucara Diamond TSX:LUC came out on top, gaining 66% on its share price. Brigus Gold TSX:BRD gained 42% throughout the quarter after its flagship Black Fox mine achieved record gold production.

But miners can take solace in the fact that 2013 is over and, at least according to Ernst & Young, 2014 will provide growth opportunities for companies across the sector.

“We note that a new year has brought some transactional activity for companies with good quality projects and lower valuations,” researchers wrote.

“Investors are likely to view the current underperformance as a buying opportunity as projects are de-risked. We expect companies to continue to adopt a disciplined approach to capital management and to seek creative financing options to withstand the downturn.”

Reprinted by permission of MINING.com

Precious, practical and fickle

November 13th, 2013

Platinum’s supply shortage won’t boost its near-term price, a report cautions

by Greg Klein

Forecasts that platinum prices would break free of gold have so far proved premature. True, the metal now attracts strong ETF interest in addition to industrial uses, not to mention jewelry and bullion. Demand is set to hit record levels this year, pushing supply further into deficit. But a comprehensive study of the metal’s 2013 performance finds it “increasingly unresponsive to supply-side concerns.”

Indeed, “after rising above $1,700 in February, platinum was dragged below $1,400 following a sharp fall in the gold price.” That comes from the Platinum 2013 Interim Review released November 12 by Johnson Matthey, self-described as “the world’s leading authority on platinum group metals.” The 40-page report compiled by an 11-person research team tracks the year’s PGM performance in supply, demand and price by jurisdiction and use. While the study finds considerable push and pull from other forces, the vagaries that trouble gold seem to afflict platinum too.

Yet this year’s supply deficit is forecast at 605,000 ounces, compared to 340,000 ounces in 2012, thanks to ETFs and industry. The latter includes automotive catalytic converters as well as chemical, electrical, glass, petroleum and medical/biomedical uses.

Platinum’s supply shortage won’t boost its near-term price, a report cautions

The researchers say an 11.5% increase in industrial demand will come largely from chemical uses while catalyst demand will drop. As for ETFs, “unprecedented offtake” in South Africa, along with ETFs from other regions as well as bars and coins, “will lift investment demand to a record 765,000 ounces.”

Most of that came from “pent-up demand” in SA where the new Absa Capital ETF rose to 660,000 ounces between its April launch and the end of September, Johnson Matthey points out. The rand-denominated, Johannesburg-traded product attracted institutions that face limits on foreign investments, but also anyone who could afford the 1/100th-ounce minimum purchase.

Along with supply concerns, that ETF partly offset the precious metals plunge that started in April. But by the end of September, the report indicates, platinum’s performance often mimicked gold’s rise and fall in response to speculations about the Fed, quantitative easing and the U.S. debt ceiling. The study tracks platinum’s progress to a September 27 low of $1,411. Still, that’s an improvement over $1,323 in June following the spring precious metals crash that coincided with a weakening auto sector in Europe. Platinum began November 13 at $1,436.

The anticipated breakout from gold hasn’t happened. Even so the year’s platinum mine supply forecast comes to 5.74 million ounces (up 1.6% from 2012), plus 2.07 million ounces from recycling, versus 8.42 million ounces of demand (up 4.9%). Commodity price explanations don’t come easily, especially with precious metals. And platinum is considered both precious and industrial, potentially pulled in different directions by opposite forces. Johnson Matthey attributes about 9% of 2013 demand to investment and 32% to jewelry.

Looking ahead, the report sees a third consecutive deficit next year but “this may not be sufficient to support higher platinum prices.” The predicament of South Africa, the world’s leading producer but with dwindling reserves and uncertain labour conditions, might have been expected to push platinum prices further. “But investor fatigue appears to have set in and sporadic strikes in 2013 have had increasingly little influence on the price.”

[A not-yet launched Johannesburg-traded ETF comprises] the biggest uncertainty facing the palladium market next year.—Johnson Matthey’s
Platinum 2013 Interim Review

The report sees palladium ($741 an ounce on November 13) showing a smaller but still significant 2013 deficit of 740,000 ounces. The metal’s mined for catalysts, largely for gas engines, as opposed to diesel motor catalysts that use platinum. Other key consumers are the chemical, dental and electrical industries.

The mine supply forecast shows 6.43 million ounces, down about 1.5% from last year. Recycling brings in another 2.46 million. Demand comes to 9.63 million, down 3.4%. About 7.8% of demand comes from investment and 4% from jewelry.

Both industrial and investor demand have dropped despite “significant inflows into palladium ETFs in the first two months.” But the authors note that Absa Capital has received SA regulatory approval for a Johannesburg-traded palladium ETF, a “wild card” that’s “the biggest uncertainty facing the palladium market next year.” The ETF’s launch date hasn’t been announced.

Rhodium, also used for catalysts and in the chemical, electrical and glass industries, began November 13 at $980. That’s barely above July’s nine-year low of $975, despite demand reaching a six-year high. The report attributes the contradiction to a “large hangover of surplus metal that accumulated between 2008 and 2011.” Today’s small deficits are “entirely due to the movement of market stocks into physically-backed investment products” from a Deutsche Bank rhodium ETF as well as rhodium bars sold in North America and Europe.

Prices for ruthenium and iridium, both used for electrical, chemical and (of course) electro-chemical uses, dropped sharply this year. The report attributes “a long-term imbalance between primary production and consumer offtake.”

Examining supply by jurisdiction, South Africa shows little change in platinum production, a result of depleting deposits and labour unrest. Only Zimbabwe, a country fraught with jurisdictional risk, is likely to increase its platinum output in 2014.

Russia’s platinum production will see a slight decline. Palladium too, because of reduced sales from government stockpiles, “now an insignificant part of the overall palladium supply picture.”

Nor will Canadian production see much change. Lower output from North American Palladium’s TSX:PDL Lac des Iles mine in northwestern Ontario will be offset by increased palladium byproduct from nickel operations at Glencore Xstrata’s Raglan mine in northern Quebec and Vale’s Sudbury operations, the report states.