Friday April 4, 2014 8:03 AM
UBS estimates that nearly 500,000 ounces of platinum production has been lost since a strike against three major South African producers began in late January. The amount is comparable to the lost ounces back in 2012 when the Marikana strike occurred, UBS said. “From a market balance perspective, this is a substantial reduction on the supply side, especially given that: 1) it is only April; 2) the strike continues, with no resolution in sight for now; and 3) even when a resolution is reached, it will take some time for production to go back online and ramp up to more normal levels,” UBS says. Strong statements from the Association of Mineworkers and Construction Union suggest union leaders are not willing to budge yet, while producers are maintaining that worker demands are unaffordable, UBS notes.
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