MINERAL REVIEW AND FORECAST: PRECIOUS METALS; PLATINUM METALS

In 1991, industrial demand for platinum in the non-socialist world increased by more than 5% over 1990. Despite demand, prices hit a six-year low of US$330/oz on Dec. 30, trading below gold for the first time since 1985. The price was affected by announcements by Nissan and Isuzu that they could commercially produce catalytic converters made only of palladium by 1994.

The average price of palladium fell from $114/oz in 1990 to $80 in 1991.

Rhodium prices, which had skyrocketed to US$7,000/oz in July, 1990, were closer to $2,000 by year-end 1991. Consumption for three-way automobile exhaust catalysts should continue to grow in the 1990s.

Canadian developments

Canadian production of platinum group metals (PGM) in 1991 decreased to 10,960 kg from 11,120 kg in 1990. The bulk of production is derived from nickel mining at Sudbury, Ont., although small amounts come from similar mines in Thompson and near Flin Flon, both in Manitoba.

Start up of the Lac-des-Iles palladium-platinum property of Madeleine Mines in northwestern Ontario has been delayed since December, 1990, due to a dispute between the company and the Ontario Department of Environment. Production at the 3,000-t/d operation is now expected to begin this summer. Annual output should be 4,665 kg PGM, 625 kg Au, 900 tonnes Cu, and 900 tonnes Ni.

Inco discovered two new PGM-rich nickel deposits in the Sudbury Basin. The Victor deposit grades 12.2 g/t PGMs and gold. The deposit near the McCreedy East mine contains 10.9 g/t PGMs and gold.

Outlook

Platinum markets are expected to perform favorably in 1992. New requirements that all cars sold in Western Europe be equipped with catalytic converters by 1993 should push up platinum consumption by 10%. In addition, jewellery demand in Japan, which accounts for more than one-third of world platinum consumption, is expected to continue to grow.