Platinum prices were pushed above $US 2,000 an ounce last week, hitting a new record. It came after another major platinum producer reported a drop in output because of a power shortage in South Africa.
Analysts are seeing great potential for prices to go higher still, with no short-term solution to the energy woes in South Africa, rising global demand and a widening supply deficit. Russia's largest platinum producer, Norilsk Nickel, has announced it will produce additional platinum from concentrate due to increased recovery rates, and is looking to beef up the capacity of its Krasnoyarsk operations. “Platinum prices have reached an all-time high. Looking at the price forecast we are considering expanding production of platinum. We intend to upgrade production at our Krasnoyarsk plant,” said Denis Morozov, General Director of Norilsk Nickel. Faced with rising prices, manufacturers using the metal may look at switching to palladium, and this too will add to Norilsk's bottom line. Norilsk Nickel announced an increase in production of the platinum alternative and, as the largest producer of both metals outside South Africa, is likely to increase its role on the international metals market.