-- Impala's Platinum Rustenburg at 85% of full output in May; to reach 100% output in June
-- Global platinum market seen close to balanced in 2012 following surplus in 2011
-- Platinum and palladium markets seen in deficit over next five-year period
(Adds details about Rustenburg production in the second paragraph, and details of Impala's global platinum outlook throughout.)
By Alex MacDonald
Of DOW JONES NEWSWIRES
LONDON -(Dow Jones)- Impala Platinum Holdings Ltd. (IMP.JO), the world's second-largest producer of the metal, said Tuesday that Rustenburg, its largest platinum operation, had reached about 85% of full production and is due to reach full production in June, a company spokesman confirmed Wednesday.
The Johannesburg-based miner had initially targeted 900,000 ounces of platinum production from Rustenburg for the fiscal year ending June 30, 2012 but a protracted illegal strike at Rustenburg in February significantly curtailed production there. The company has refrained from giving a new official production target as it continues to ramp up the mining complex to full production.
The company's executive director of South African operations, Paul Dunne, told analysts on a conference call Tuesday that Rustenburg produced 64,000 troy ounces of platinum in May compared to previous expectations that Rustenburg would produce about 75,000 ounces a month for each of the 12 months in the current fiscal year.
"Shafts 12, six, eight and five shaft, although small, have all reached 100% of their expected production and we are confident that the rest will follow into June," he said.
Rustenburg suffered about 120,000 ounces of lost platinum output due to a six-week illegal strike in its third fiscal quarter ending March 31. The lost output contributed to a 46% drop in the company's total platinum output to 230,000 troy ounces in the third quarter compared with the same quarter a year before.
A company spokesman said Impala Platinum intends to reach 100% platinum output per month in June. The company confirmed an analyst's calculation on the call that the company was likely to achieve 750,000 oz of platinum output from the reef area around Rustenburg for the full fiscal year ending June 30, although David Brown said the company wasn't yet prepared to confirm a final output guidance for the year.
The company confirmed another calculation from the same analyst that the company was likely to produce 65,000 to 70,000 ounces of platinum in June from the Rustenburg complex.
Separately, Bob Gilmour, the head of corporate relations, said the outlook for platinum and palladium remains robust in the medium to long term, driven by tighter restrictions on vehicular emissions, but said demand in the short term remains mixed.
He said the platinum market is "currently dominated by the global macroeconomic environment and particularly the euro zone crisis. This will impact European vehicle sales and obviously platinum given that an excess of 50% sales are diesel which is the platinum base [for] autocatalysts."
Counterbalancing weak demand in Europe is a rebound in North American vehicle sales, a rebound in Japanese vehicle sales following last year's earthquake and growth in emerging markets such as China where the government is looking to fund vehicle sales in rural areas and also a "cash for clunkers" program, Gilmour said, referring to the financial incentive scheme to replace old cars with new models. He also noted that Chinese jewlery demand remains firm, aided by weaker platinum prices.
Impala Platinum expects the global platinum market to be close to balanced this year following a surplus last year due to lower output from South Africa and flatish output elsewhere. South Africa accounts for about three-quarters of global platinum supply.
He added that he expects both the platinum and palladium markets to remain in deficit over the next five years.
-By Alex MacDonald, Dow Jones Newswires; +44 (0)20 7842 9328; firstname.lastname@example.org
(END) Dow Jones Newswires
May 30, 2012 04:40 ET (08:40 GMT)
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