South Africa’s crippling strike in the platinum sector has entered its 20th week after the main mineworkers’ union rejected a government-brokered wage proposal. Ample oil supplies pressured U.S. and Brent crude prices. Among softs, cocoa’s rally continued, supported by a tightening supply/demand outlook, while coffee and sugar extended recent losses.
Fresh hopes of ending the crippling 19-week strike at South African platinum mines owned by the world’s three biggest producers appear to have been dashed.
The main union, the Association of Mineworkers and Construction Union (Amcu), is reported to have rejected a government-brokered proposal aimed at resolving the labour dispute. The union is holding out for its demand of a R12,500 ($1,160) per month basic wage for the mineworkers, according to local media.
Hopes of a resolution to the strike at the mines owned by Anglo American Platinum (Amplats), Impala Platinum (Implats) and Lonmin were bolstered last week when South Africa’s new Mineral Resources Minister, Ngoako Ramathlodi, threw his weight behind the mediation efforts, in a effort to break the deadlock between the three producers and the striking mineworkers.
Platinum and palladium prices were not much moved by the prospect of yet another set of stalled negotiations. Platinum for July delivery on the Comex division of the New York Mercantile Exchange (Nymex) was trading at $1,446.35 an ounce in late trade on June 5 after settling at $1,433.90 the previous day.
July platinum had finished last week at $1,452.70. Similarly, palladium for September delivery on Comex was at $839.70 an ounce at time of writing . It had closed at $837.15 on June 4, marginally up on its May 30 settlement of $836.50.
Meanwhile, gold futures slipped to fresh 18-week lows as the precious metal continued to lose its safe-haven appeal amid easing tensions over Ukraine and upbeat economic data.
Gold for August delivery on Comex settled at $1,244.30 an ounce on June 4 after hitting an 18-week low of $1,240.20 on June 3. Gold for August had finished last week at $1,246 an ounce.
U.S., Brent crude trend downward on ample supplies
Crude oil futures see-sawed amid mixed market data from China and the U.S., as well as higher Organization of Petroleum Exporting Countries (OPEC) output. For Brent North Sea crude prices, the international benchmark, the trend was generally downward, while U.S. crude found some limited support from a bigger-than-expected drop in the country’s crude inventories.
The U.S. West Texas Intermediate (WTI) benchmark for July on Nymex edged up near $103 a barrel on June 4 after government data from the Energy Information Administration (EIA) showed U.S. commercial crude stocks fell 3.4 million barrels in the week to May 30 to 389.5 million barrels. July WTI settled the day at $102.64 a barrel, marginally down on the previous day’s close, and 0.07 cents below last week’s finish at $102.71.
However, the EIA data showed continued strong domestic crude production . While U.S. crude output was marginally lower week-on-week for the week to May 30, the four-week output average to May 30 was 15.6 percent higher at 8.429 million barrels than the same period a year ago.
Adding further to the ample supply scenario, OPEC output rose to a three-month high in May, according to a Reuters survey published May 30, as rising supplies from Angola and a further increase in exports from southern Iraq offset a deteriorating situation in Libya.
