Charlotte’s BAML sees platinum, palladium deficits rise as S. Africa output totters


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Charlotte’s BAML sees platinum, palladium deficits rise as S. Africa output totters

Late on Friday, the 8th of May 2020, analysts of the Charlotte-based American multinational investment lender, Bank of America Merrill Lynch said in a statement that a deficit in platinum and palladium output appeared to be highly likely this year, as the world’s largest producer of the precious metal palladium, S.

Africa had been reeling on to a forced closure of its mines as part of an effort to contain the pandemic outbreak. Apart from that, the Bank of America Merrill Lynch had added on their Friday’s (May 8th) announcement that the demand of platinum group metals had been languishing lavishly due to the pandemic outbreak, while the analysts were also quoted saying that there would be a sharp rebound in demands over the second half of the year, but a strict lockdown that led to a forced closure of South African mines since March 27th, would likely to take over six months to heave productions up on to a pre-pandemic level.

As a matter of fact, South Africa has been accountable for production of roughly 78 per cent of world’s entire platinum output, while the African continent’s most industrialized nation with a free-market oriented economy having a higher human development index (70.3), has been contributing to 36 per cent of the world’s total palladium production.

Meanwhile, adding that it might take up to end-December for the S. African mines to become fully functional, analysts of Bank of America Merrill Lynch wrote in a client note dated May 7th, “Our base line assumption is that output runs at 50% in May and June, before rising to capacity by December.

Putting it all together, we anticipate that both platinum and palladium will be in deficit this year. As such, we remain bullish the white metals into year-end.