Impala Platinum has again bemoaned unstable electricity supplies in SA and Zimbabwe after power outages weighed on its third-quarter output.
The miner reported a 5% decline in production for the three months ended September thanks partly to an unstable power supply at its Rustenburg operations, which are home to a fifth of the group’s total mineral reserves.
Zimplats, the larger of the group’s two Zimbabwean operations, was also hit by several power outages, destabilising its concentrator and contributing to the decline in 6E concentrate production.
Zimbabwean power outages also took a toll on Implats’ Mimosa operation, it said, impeding processing stability and leading to lower recoveries. The operation’s output was down 6% in the period.
Implats’ Zimbabwean assets form a core part of its mining portfolio, together being home to 45% of the group’s platinum reserves and more than half of its palladium reserves.
The group ― valued at R168.6bn on the JSE with 66,000 employees across its SA, Zimbabwean and Canadian platinum group metals (PGMs) mines ― has been striving to integrate more renewable electricity into its operations this year to address double-digit electricity hikes in SA and unstable power supply.
In January, it signed an agreement with Discovery Green to supply 90% of Implats’ SA refineries’ electricity needs from next year, delivering more than 130,000 MWh of wheeled energy a year and reducing its reliance on Eskom.
Despite the weaker operational performance, soaring PGM prices saw the company report a 7% improvement in metal sales to 847,000oz.
Implats CEO Nico Muller said the recent surge in prices provided a “welcome tailwind”. After three years of stubbornly low prices, suppressed by fears about electric vehicles (EVs) negating catalytic converters, platinum has skyrocketed to 12-year highs in recent months on suppressed supply, safe-haven demand and surprisingly high hybrid EV sales.
“We recently successfully concluded annual contractual negotiations with our core customer base, reaffirming our outlook for rising demand across our suite of precious and base metals,” said Muller.
“After a prolonged period of market complacency, ongoing geopolitical and macroeconomic uncertainty has driven increased demand for supply surety and critical metals security.”
Muller is upbeat about the group’s prospects for the 2026 financial year after three years of stubbornly low PGM prices saw it cutting costs and keeping a close eye on capital spending.
The most notable cost-cutting measure was Implats’ decision early last year to retrench nearly 4,000 workers across its Rustenburg, Impala Bafokeng and Marula operations. The cash-strapped miner also opted to skip a final dividend payout in the 2024 financial year and in the six months to end-December 2024.
“After a prolonged period of depressed pricing we believe the group is entering a more cash-generative period,” Muller said last month.
The company’s share price fell 4.7% to R186.40 on Friday though year to date it is up 99.6%.
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