Despite recent output cuts, we think that platinum prices have further to fall. We have pencilled in a low of $1,300 per oz for early 2013, from current levels of around $1,420. Given rising costs in South Africa and falling prices, the number of closed mines and shafts will escalate. This should support a small pick-up in the price of platinum later next year, even though industrial demand will remain weak. But we would still expect prices to remain well below the consensus forecasts of around $1,800. The risks, especially in the event of euro-zone break-up, would also still be skewed to the downside.
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