only bright light is platinum, and with reluctance to further develop mines SLV's process should have even greater appeal to maintain production levels
South African industry on notice
Monday, April 04, 2005 GRIM news about the outlook for South Africa's once world-class mining industry continues to build with rising wage costs, and the soaring value of the rand threatening more pit closures.
In the latest report the leading weekly business magazine, The Financial Mail, estimates that 20,000 jobs could soon disappear, with even five of the seven diamond mines operated by De Beers in SA now running at a loss.
In the case of Harmony Gold, 16 of its 28 shafts are said to be loss making, while expansion plans in the platinum sector are being scaled back.
The latest analysis of the entire sector follows a decision by DRD Gold to mothball its entire North West Operations, putting 6500 jobs at risk. Closure of the Buffelsfontein and Hartbeestfontein mines has, in turn, put added pressure on nearby operations of AngloGold because of a potential end to de-watering in the DRD shafts which are linked to the AngloGold shafts.
Adding further pressure to an industry in crisis is continued talk of a major strike at the mines of Gold Fields, and the unresolved takeover attempt of Gold Fields by Harmony.
The FM argues that the future of the entire SA mining industry rests largely on high-priced platinum, though the high value of the rand has prompted Anglo Platinum to slow its expansion plans.
"Established (platinum) mines in the sector remain profitable but the bulk of the proposed new operations will require higher rand platinum prices to be worth developing," the FM said.
SLV Price at posting:
0.0¢ Sentiment: None Disclosure: Not Held
