• 4 minutes Energy Armageddon
  • 6 minutes How Far Have We Really Gotten With Alternative Energy
  • 10 minutes Russia Says Europe Will Struggle To Replace Its Oil Products
  • 1 min GREEN NEW DEAL = BLIZZARD OF LIES
  • 15 hours Reality catching up with EV forecasts
  • 2 days "Natural Gas Price Fundamental Daily Forecast – Grinding Toward Summer Highs Despite Huge Short Interest" by James Hyerczyk & REUTERS on NatGas
  • 12 days US Oil Independence is a myth and will always be a myth
  • 2 days A Somewhat Realistic View of the Near Future for Electric Vehicles Worldwide
  • 8 days The Federal Reserve and Money...Aspects which are not widely known
  • 17 days Natural gas price to spike when USA is out of the market
  • 13 days Oil Stocks, Market Direction, Bitcoin, Minerals, Gold, Silver - Technical Trading <--- Chris Vermeulen & Gareth Soloway weigh in
  • 15 days "Biden Is Running U.S. Energy Security Into The Ground" by Irina Slav
  • 16 days *****5 STARS - "The Markets are Rigged" by The Corbett Report
Dave Forest

Dave Forest

Dave is Managing Geologist of the Pierce Points Daily E-Letter.

More Info

Premium Content

Big Buyers Are Looking At This Troubled Metal

There seems to be a trend emerging in mining M&A--in an unexpected part of the world.

That's South Africa. Particularly, in one of that country's most troubled sectors: platinum.

In January, we saw underground platinum mining assets here bought by China National Arts & Crafts Corporation. The deal was relatively small at $37 million. But it appears this may have just been a toe in the water.

Reports last week suggest that Chinese buyers may be planning bigger platinum purchases. With Bloomberg writing that funds partnered with massive Chinese investment outfit Citic Group are eying rock-bottom valuations for mining firms in this space.

ADVERTISEMENT

This would be a contrarian move, to be sure. General sentiment around the South African hard rock mining sector has been ebbing of late. Weighed down by labor unrest and difficulties with electric power procurement.

But potential Chinese buying here could well prove to be a timely play. In short, the world still needs platinum--and there aren't a lot of options globally for mining it.

With South Africa still producing 70% of the world's platinum supply, the nation remains the gorilla in the room for this market.  As I've discussed, platinum producers are starting to step outside of their usual haunts in looking for new exploration ideas. But it's going to be awhile until any of these conceptual plays bear fruit--if indeed they ever do.

ADVERTISEMENT

In the meantime, there's simply no substitute for South Africa's massive platinum output. Issues or not.

Chinese buyers clearly realize this. And thus see an opportunity in a sector where valuations for miners are down 75% over the last few years.

We may see some action in this space soon.

Here's to crisis and opportunity,

Dave Forest


Download The Free Oilprice App Today

Back to homepage


ADVERTISEMENT


ADVERTISEMENT



Leave a comment

Leave a comment




EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News