There’s a shortage of platinum this year – and that’s good news for Zimbabwe’s miners

Zimbabwe unki platinum

The world platinum industry expects a shortage of the metal this year – and that is good news for Zimbabwean producers, who are currently expanding operations.

There will be a platinum deficit of 983,000 ounces in 2023, according to a new report by the World Platinum Investment Council (WPIC), which represents the world’s leading producers. The deficit is 77% more than was estimated in March, the report says.

Leading producers South Africa and Russia will suffer production declines this year. But Zimbabwe will produce 22 000 ounces more as its mines expand, says WPIC.

“While losses in South Africa will be offset by gains in Zimbabwe and North America, there are significant uncertainties surrounding South African platinum supply for the upcoming year,” says the report, citing power cuts in South Africa. “Output from Zimbabwe is…expected to continue incremental growth as additional volumes from expansion projects are realised.”

Demand for platinum is being driven by more carmakers switching to platinum to use in catalytic converters. There is also demand from chemical and glass producers in China.

The deficit means that platinum prices may rise, benefitting Zimbabwean companies. Prices are currently around US$1,070 per ounce, having risen as high as US$1,130 in April.

Zimplats is currently on a US$1.8 billion expansion plan, which includes developing new mines and expanding processing. So far, Zimplats has spent US$295.3 million on the development of Mupani Mine and the upgrade of Bimha Mine. Zimplats is also investing US$190 million into a base metal refinery, as part of a plan to process platinum locally.

Unki, the country’s second-largest producer, produced a record 232,000 ounces last year as it benefitted from a new US$62 million smelter.

Mimosa Platinum, which produces 124,000 ounces, is investing US$200 million to develop new mining areas at its operations near Zvishavane.

Construction of Zimbabwe’s newest platinum project, Karo Platinum, started late last year and the first production is expected in 2024. When complete, Karo will produce up to 194,000 ounces of PGMs per year.

ALSO READ | Karo to start trial mining at new Selous platinum project, secures more funding