Platinum Prices Surge Amid South African Uncertainty

Strategic Insights -

South African tensions and the potential for supply disruptions caused by Nelson Mandela's canceled campaign appearances propelled platinum prices to a six-month high yesterday. The African National Congress leader's cancellation raised concerns about his health, prompting speculation and a market reaction that saw the precious metal surge to its highest price since August 4. The volatility in the platinum market was further exacerbated by a strong silver price, which reached a four-year high, while gold futures weakened.

Key Takeaways:

  • Platinum prices hit a six-month high at $413.50 per ounce, the highest settlement since August 4, due to concerns about Nelson Mandela's health and potential supply disruptions.
  • The active May silver contract climbed 5.5 cents an ounce to $5.80, reaching its highest price since November 1989.
  • Gold futures weakened, with April delivery slipping 70 cents to $391.20 per ounce.
  • Nelson Mandela's African National Congress party showed strong support among Zulus, drawing over 100,000 people to two marches demanding free political activity.
  • World platinum production was estimated at 4.21 million ounces, while demand was estimated at 4.02 million ounces, according to Johnson Matthey P.L.C.
  • US commodities were also affected, with crude oil prices edging higher, and April heating oil rising 1.07 cents to 46.28 cents a gallon.

Statistics:

  • Platinum for April delivery increased by $5.40 an ounce to $413.50.
  • The active May silver contract climbed 5.5 cents an ounce, reaching $5.80.
  • Gold for April delivery slipped 70 cents to $391.20 an ounce.
  • World platinum production was estimated at 4.21 million ounces.
  • Demand was estimated at 4.02 million ounces, according to Johnson Matthey P.L.C.
  • Light sweet crude for May delivery rose 5 cents to $15.13 a barrel.
  • April heating oil rose 1.07 cents to 46.28 cents a gallon.

Sources:

  • "Platinum prices surge to six-month high," The Wall Street Journal (undated).
  • "South African leader cancels campaign appearances," The New York Times (undated).
  • Johnson Matthey P.L.C. (undated).
  • Bernard Savaiko, Paine Webber senior metals analyst (undated).
  • Ian MacDonald, Credit Suisse (undated).