December 10, 2019 / 4:21 PM / 2 months ago

PRECIOUS-Palladium breaches $1,900 ceiling after South Africa outages

 (Updates prices)
    * Palladium extends gains for 13th session
    * Harmony Gold, Impala Platinum cut production at S. African
mines
    * GRAPHIC-2019 asset returns: tmsnrt.rs/2jvdmXl

    By Karthika Suresh Namboothiri
    Dec 10 (Reuters) - Palladium zoomed past $1,900 an ounce for
the first time ever on Tuesday as a power crisis halted
production at mines in major producer South Africa, exacerbating
concerns over supply and extending the autocatalyst's record
run.
    Spot palladium        was up 0.7% at $1,894.85 an ounce, as
of 1:50 p.m. (1850 GMT), having earlier hit an all-time high of
$1,903.
    "South Africa produces 40% of world's palladium and the
ESKOM outages are hitting some mines, giving palladium just that
extra nudge above $1,900," said Tai Wong, head of base and
precious metals derivatives trading at BMO.
    "We've now had 13 consecutive positive sessions, which seems
a little rich, so it wouldn't be surprising to see some
consolidation, though the overall trend continues to look quite
positive."
    Mines across South Africa are shutting down after flash
flooding caused the largest power blackouts in more than a
decade, with major miners Harmony Gold         , Impala Platinum
        , and Sibanye-Stillwater          all being forced to
cut production.             
    Scarcity concerns surrounding palladium have already helped
the metal rise about 50% in 2019, owing to its large demand in
the auto sector.
    Other metals also gained on the outages in South Africa,
with platinum        up 2.3% at $915.53 an ounce, the highest
since Nov. 22. Silver        rose 0.4% to $16.66.
    Gold got a further lift form uncertainties surrounding
U.S.-China trade talks ahead of a Dec. 15 tariff deadline and a
weaker dollar.       
    Spot gold        rose 0.1% to $1,463.88 per ounce. U.S. gold
futures        settled up 0.2% at $1,468.10.
    "Gold is riding higher on dollar weakness and caution ahead
of a looming tariff deadline," said FXTM analyst Lukman Otunuga.
    If Washington proceeds with the earmarked tariffs, gold
could get a further boost, he added.
     A Wall Street Journal report said trade negotiators from
both sides were planning for a delay of the December tariffs.
                
    Gold pared gains on the report, but remained supported as
doubts over a phase-one deal persisted.
    Markets also sought monetary outlook for 2020 by the U.S
Federal Reserve, which is expected to keep rates unchanged at
its two-day policy meeting ending Wednesday.
    "In the short-term, if the Fed shifts to a more hawkish
assessment, gold is at risk from further repositioning.
Technically this could pull prices back to $1,410/oz," UBS
analysts said in a note.

    
 (Reporting by Karthika Suresh Namboothiri, Arpan Varghese and
Harshith Aranya in Bengaluru
Editing by Nick Zieminski and Richard Chang)
  
0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below