The Long-Term PGM Market Outlook

SFA (Oxford)'s PGM Market Outlook reports are, collectively, an in-depth, forward-looking reporting service on the current and long-term trends and influences acting on global the platinum, palladium and rhodium markets, their sources of supply and demand, and their investment vehicles. Released on a biannual or annual basis and tailored to client requirements, each report delivers a concise picture of the key PGM metal markets, and is vital understanding price risks, sustainability of the market, for investment strategising and participation in any part of the PGM value chain.

The detailed analysis and valuable industry insight is backed up by nine analysts working discreetly with the industry in all areas of the value chain, whether underground in South Africa, valuing projects and plants all over the world, working with fabricators to assess the impact of new end-uses on the markets, visiting China and Japan to access the health of the jewellery markets or with corporate Boards conducting price risk analysis for multimillion dollar business decisions. 

Who Should Read This Report

    • Commodity risk managers from fabricators, car companies, petroleum companies and other end-users assessing price volatility, price direction, or the economics and security of supply. 
    • Financers, pension funds, investors and other financial institutions needing to understand the long-term risks and opportunities in the industry, future costs of production and long-term prices for project and business valuation. 
    • Miners, refiners and juniors that need long-term prices and market justification for project appraisal, investment timing, business strategy, and an independent view on the markets.
    • New business entrants.

          The Report

          The reports contain:

          • Robust, economically derived, PGM price forecasts for ten years based on fundamental global and regional supply-demand market developments and relevant macroeconomic factors. The Board note offers an explanation of the influence of both the project incentive price and mine closure inducement price on the long-term average price, along with assumptions and calculations used to derive such logic, including an associated incentive price by project. Similarly, SFA’s methodology for a long-term average price beyond a five-year forward curve and its use as a proxy for the average pricing beyond 2020 is articulated. 
          • An analysis of global demand trends on a regional basis, covering the major PGM end-use sectors (autocatalysis, jewellery, glass, petroleum, electronics, chemical, nitric acid, and medical/dental) and including the investment sector (such as exchange traded funds). 
          • An analysis of global autocatalytic demand, with special attention applied to environmental legislation affecting global emission standards, gasoline, diesel and hybrid trends, PGM loadings (thrifting) and the substitutability of platinum and palladium in this end-use sector. Future automotive developments and opportunities for PGM demand growth will also be commented on, including fuel cell technology, hybrid vehicles and other alternative fuels. A breakdown of autocatalyst history/forecasts by region and associated assumptions (automobile volume and associated intensity of PGM loadings) will be added.
          • An assessment of the future potential volumes of recycling will be presented, to include autocatalyst, jewellery and electronic scrapping rates. The analysis will cover collection rates, types and age of scrap supply, timing, contained metal and ratios, the business case to recycle, as well as incentive prices and impacts from price volatility. 
          • Reports of historical, current and future producer mine supply trends for PGMs, referencing recent expansions and their deliverability, other new projects, including the junior sector coming on-line and projects shelved or postponed. PGMs produced as by-products of base-metal mining will also be considered. 
          • A comprehensive explanation of the long-term cost of producing virgin metal, taking account of the cost and profit dynamics of production on a regional basis (Western Bushveld, Eastern Bushveld, Zimbabwe, USA, Canada and Russia). Forward extrapolations of producer production profiles, costs and margins will be conducted to provide a short-, medium- and long-term picture of producers’ profitability. Mines which do not have PGMs as their primary output but which are, nevertheless, substantial PGM producers (‘Norilsk’, a nickel producer, and ‘Canadian other’, which includes the operations of Inco and Falconbridge) are also included in our analysis. 
          • Producer profiles using a consistent framework for comparison based on cash costs and excluding capital, financing and depreciation/amortization charges. The basic cost measurement reflects primarily physical production costs and includes other cash costs incurred, being mainly corporate overheads, marketing and royalties, etc. Costs are calculated net of the credits arising from the sale of by-products (Net TCC/4E oz). Rand currency sensitivity comments will be included. Key components/assumptions for the cash cost curve will be defined. 

            Bespoke Workshops

            If required our analysts can facilitate a bespoke workshop around each Briefing, offering you and your colleagues a greater understanding of the long-term outlook for the industry and markets whilst providing SFA (Oxford)'s unique views and insights.

            Your Copy

            For more information on The Long-Term PGM Market Outlook, or to obtain your copy, please get in touch with us here.