LONDON, March 11 Platinum holdings in physically
backed exchange-traded funds have hit a record high after fresh
inflows into funds listed in London and Johannesburg, and are
set to rise further as a strike in major producer South Africa
The world's largest platinum-backed ETF, NewPlat ETF
reported an inflow of around 4,000 ounces on Monday,
taking its holdings to a near seven-week high at 908,811 ounces.
On the same day, London-based ETFS Physical Platinum
reported an inflow of 4,505 ounces, taking its holdings
to just under 325,000 ounces.
Platinum ETFs, popular investment vehicles which issue
securities backed by physical metal, now hold a record 2.215
million ounces, equivalent to around seven months of supply.
The white metal, used in catalytic converters for
automobiles, has attracted investors as a strike over wages in
the South African platinum belt edges towards a seventh week,
"In terms of ETFs, you've got to think that the longer the
strike goes on, and as above-ground stocks are consumed, it's
got to be positive," Citi analyst David Wilson said. "People
must be thinking that prices are going to rise."
Platinum prices initially reacted only marginally to
the strike, but by last week they had risen to a six-month high
at $1,486 an ounce, up 8 percent from the start of the year.
Preliminary orders for the NewPlat ETF, which is listed in
South Africa by Barclays unit Absa Capital, suggest its holdings
will hit a record high around 944,000 ounces later this week.
NewPlat is less than one year old, having launched in April
2013, but had become the world's largest platinum ETF in just
Analysts say the fund proved popular with South African
investors seeking exposure to platinum without having to buy
troubled mining stocks, which have suffered from a toxic mix of
rising costs, labour unrest and weak demand for their products.
Absa's head of investments, Vladimir Nedeljkovic, said new
inflows into the fund largely represented buying by existing,
rather than new, clients.