Gold And Platinum Surge As Mining Unrest Spreads

Tyler Durden's picture

From GoldCore

Gold And Platinum Surge As Mining Unrest Spreads

Today's AM fix was USD 1,662.50, EUR 1,324.07, and GBP 1,047.57per ounce.
Yesterday’s AM fix was USD 1,640.50, EUR 1,315.87 and GBP 1,038.49 per ounce.

Silver is trading at $30.36/oz, €24.30/oz and £19.31/oz. Platinum is trading at $1,543.75/oz, palladium at $628.10/oz and rhodium at $1,025/oz.

Gold surged $17.10 or 1.04% in New York yesterday and closed at $1,654.40. Silver surged to a high of $29.91 and finished with a gain of 1.91%.

Currency Ranked Returns – (Bloomberg)

Gold rose by over 1% to over $1,665/oz late Wednesday hitting prices not seen since early May as minutes from the US Federal Reserve meeting convinced market participants that QE3 is imminent.

"Many members judged that additional monetary accommodation would likely be warranted fairly soon unless incoming information pointed to a substantial and sustainable strengthening in the pace of the economic recovery," according to the minutes from the July 31-Aug. 1 meeting.

Bullion prices have rallied for six days, moving through the technical resistance of the 150-day and 200-day moving averages. Gold hit the top of a 4 month trading range when it broke $1,640/oz.

Platinum and palladium also rallied for a 5th straight day on growing fears that violence due to labor issues will spread to other mines in South Africa and create increased supply shortages.

Year to date, despite much negative sentiment towards gold, dollar gold is up nearly 6%.  In January the yellow metal surged nearly 15% after the US Fed said it could unveil more stimulus and expected to keep interest rates near zero until 2014.

Similar moves may be seen again soon given the fundamentals.

Industrial unrest hobbling the South African platinum industry deepened yesterday, prompting fears of a broader mining crisis in one of the main platinum and gold producing countries.

Platinum and gold prices continued to soar partly due to real concerns of supply disruptions after 44 people died during strikes at a pit owned by  Lonmin.

About a fifth of global platinum production capacity is idled in South Africa today as the nation holds a day of mourning for 44 miners and policemen killed in the deadliest police violence since apartheid ended (see Newswire).

Massive discontent has spread to two other important platinum mines.

Amplats, the world’s largest platinum producer that is 80% owned by Anglo American, disclosed it had received demands for pay rises at its Thembelani mine. Meanwhile, another miner, Royal Bafokeng, said about 500 people were protesting outside its Rasimone mine, and preventing others from going to work.

It seems likely that the protests will spread from the platinum sector, to other sectors, including the gold mining sector.

Cross Currency Table – (Bloomberg)

A primary problem is that the price of platinum remains low from an inflation adjusted perspective and when compared to the massive cost increases to operate mines – in terms of fuel, electricity, machinery etc.  

Higher prices would mean that companies could pay their staff higher wages and alleviate some of the deepening industrial unrest in South Africa. 

For breaking news and commentary on financial markets and gold, follow us on Twitter.

(Bloomberg) -- Gold Futures in India Climb to Record 30,699 Rupees Per 10 Grams
Gold futures in India advanced as much as 1.3 percent to a record 30,699 rupees per 10 grams. The October-delivery contract traded 1.1 percent higher at 30,638 rupees on the Multi Commodity Exchange of India Ltd. at 11:01 a.m. in Mumbai.

(Bloomberg) –China Central Bank Denies Report of Missing Gold
The People’s Bank of China said a report that the country is missing 80 tons of gold reserve is “totally rumor”, the official Xinhua News Agency reports, citing an unidentified official from the central bank. The report didn’t specify which media reported the gold was missing

Gold Prices/Fixes/Rates/Vols – (Bloomberg)

(Bloomberg) -- Gold Above Moving Average Signals More Gains: Technical Analysis 
Gold’s climb above its 200-day moving average yesterday may be a “shot in the arm” for prices to rally toward $1,700 an ounce, according to technical analysis by CMC Markets U.K. Plc.

The attached chart shows the metal had been trading below its 200-day moving average since March. Prices held above the measure from the beginning of 2009 through the end of last year and were again above the level for about seven weeks from January. Gold closed about $11 an ounce above the moving average yesterday and was about $21 above it today.

“One could expect a fair amount of short covering coupled with buy orders north of this,” Brenda Kelly, a senior market strategist at CMC Markets in London, wrote in a report e-mailed yesterday, referring to the 200-day moving average. Short covering is purchases to end bets on lower prices. “A break and close above may well be the shot in the arm required if we are to retarget the $1,700 level.”

Bullion for immediate delivery reached a 16-week high of $1,665.31 today and was at $1,663.40 by 7:45 a.m. in London for a 6.4 percent gain this year, extending an 11-year rally. While that’s 13 percent below the record $1,921.15 set in September, it’s still five times more than a decade ago. Holdings in gold- backed exchange-traded products reached a record 2,442.3 metric tons yesterday, data compiled by Bloomberg show.

Bullion’s 14-day relative-strength index is at 71, above the level of 70 that indicates to some analysts who study such charts that a drop in prices may be imminent.

In technical analysis, investors and analysts study charts of trading patterns and prices to predict changes in a security, commodity, currency or index.

(Bloomberg) -- iShares Silver Trust Holdings Rose 51.24 Metric Tons Yesterday
Silver holdings in the iShares Silver Trust, the biggest exchange-traded fund backed by silver, rose 51.24 metric tons to 9,784.63 tons yesterday,  according to figures on the company’s website.

(Bloomberg) -- One-Fifth of World’s Platinum Output Idled After Killings
About a fifth of global platinum production capacity was idled in South Africa today as the nation holds a day of mourning for 44 miners and policemen killed in the deadliest police violence since apartheid ended.

Impala Platinum Holdings Ltd., the second-largest producer, has suspended work for a day at the Rustenburg operation to enable workers to attend memorial services, it said in a statement. Rustenburg and Lonmin Plc’s Marikana mine, where police killed 34 protesters on Aug. 16, both tap the world’s richest platinum reserves, northwest of Johannesburg.

The police shootings occurred after 10 people, including two police officers, died in fighting among workers and union members during an illegal strike by drillers that started on Aug. 10. President Jacob Zuma declared a week of mourning and agreed to set up a judicial commission of inquiry after police fired on protesting workers armed with machetes and pistols.

“It is not acceptable for people to die where talks can be held,” Zuma told more than 1,000 striking miners yesterday, about 250 meters (820 feet) from the outcrop where the killings took place.

The violence highlighted investor concern about law and order in an economy that relies on mining for almost two-thirds of its exports. Producers of platinum in South Africa, which has the world’s largest reserves, have cut spending and idled mines following above-inflation cost increases and lower prices for the metal, used in jewelry and anti-pollution devices.

Main Service

The main memorial service will take place at the Nkaneng shanty town and starts at 11 a.m., the ministerial committee appointed by Zuma to help families of those who were killed said by e-mail yesterday. More services will be held throughout the country.

Zuma will name the members of the commission of inquiry by the end of the week, he said in a speech broadcast on Johannesburg-based SAFM radio yesterday.

The rock-drill operators are demanding that Lonmin increase their pay to 12,500 rand a month ($1,504). The protests turned violent because of rivalry between the emerging Association of Mineworkers and Construction Union and the dominant National Union of Mineworkers, according to Lonmin.

Worker discontent has spread to a nearby mine owned by Royal Bafokeng Platinum Ltd., with operations interrupted at the company’s North shaft yesterday after about 500 workers started an illegal strike, it said in a statement. Police said employees were demanding higher pay.

Worker Demands

Royal Bafokeng Investor Relations Manager Lindiwe Montshiwagae didn’t answer a call to her mobile phone. The situation at Marikana is calm today, Lonmin spokeswoman Susan Vey said by phone.

Anglo American Plc’s platinum unit, the world’s largest producer of the metal, said workers in South Africa made demands directly to the company on Aug. 17.

Lonmin has the capacity to produce about 750,000 ounces a year, mostly at its Marikana mine. Impala’s Rustenburg mine produced the same number in its last financial year. Impala in February estimated global annual supplies at about 7.7 million ounces.

Platinum has gained 5.7 percent to $1,557.95 an ounce so far this week, heading for its biggest weekly advance since the five days through Jan. 13.


Gold jumps above $1,650; Fed minutes feed stimulus hopes - Reuters

Prices of gold near record high – Times of India

South African gold miners seek to sue mining companies - Yahoo

Pimco Fund Expands Gold Holding on Outlook for Inflation – Business Week


Some Gold Bulls See Bright Future – Wall Street Journal               

Gold and Silver Price Move: Is This The Real Thing? - Mineweb

Mayans Made Drought Worse With Crops - UPI

Marc Faber's Forecasts For Global Economy – You Tube

The History Of The World's FX Regimes In One Infographic – Zero Hedge

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ZeroPoint's picture

Quick Bernanke, whack that mole down! Give me fiat AND give me death!!!!

GetZeeGold's picture



Cue Ron Paul and his magic silver dollar.


Short Memories's picture

doesn't look as wonderful if you aren't using USD which dropped 1%+

JPY/AUD is showing improvements in the metals but not to the same degree

Currency fail <> gold win if not using failing currency :P



Precious's picture

Guys getting shot.  Now there's a REAL investment thesis.  Jump on it boys.  

That gold ought to feel mighty warm in your pockets --- kinda like an omen.

BaBaBouy's picture

It's kind of simple, we are headed for GOLD $50k...


Print Forth Bennie Boy...

midtowng's picture

Gold won't go to 50K without a complete collapse of the dollar, and if that's the case then what does 50K really signify?

OTOH, Gold has without question broken out. It's over multiple resistance levels, and above its 200DMA. all the technicals have turned bullish.

The question is when do gold stocks finally recover?

BaBaBouy's picture

""Gold won't go to 50K without a complete collapse of the dollar""

How do you know this???


Instead, how about The Powers bring back Dollar GOLD BACKING, and the only way to do this is with a very high POG. Dollar still has commerce value, and a GOLD conversion...

And Politicos can still keep printing fiats to spend.


You just have to get used to the GOLD very very high price of GOLD. And watch you rring finger at all times...

Oh regional Indian's picture

Too true, the rupee has been manipulated to keep Silver prices up in a strange zombie zone here in India.

In fact, rupee/silver correlation in the past 12 months is crazy. 

Too many levers in the hands of the controllers... for now anyways. If Oil broke, seriously broke, then we'd see shades of reality in metals pricing.


Ag and AG, FTW!


jimod's picture

Nah, the next REAL currency needs to be backed by KWH.

10 KWH per dollar.

Newager23's picture

Gold might be on a run now after closing above $1640. Hopefully the nearly one year downward trend in gold is finally over and we are going to see an upward trend to a new high. Of course, this could be another false start, and we could be back to $1550 in two weeks. But I'm sensing that this might be for real. If so, it might be good time to buy some mining stocks before they make a move.


Its_the_economy_stupid's picture

So, are you making a call or not?

akak's picture

I strongly suspect that he is making a call, but on the other hand the possibility exists that he may not be.

yogibear's picture

As Mac Faber predicted Bernanke and the Fed are money printers. To support the political credit and debt junkies it's printing until faith in the US dollar is lost.

Dr. Richard Head's picture

I have to tell you that the Faber presentation in Dubai was great to watch this morning.  Dr. Doom's voice looms in my head fro the rest of zee day now. 

kridkrid's picture

It's simple, really, though the word "print" isn't completely accurate.  In a system where money is loaned into existence with interest, more money must be loaned on an ongoing basis or you you face cascading default... i.e. collapse.  So if we lemmings can't do our part and take on more debt, and if the business community can't do its part and take on more debt, then it's the role of the gov't to do its part to take on more debt.  This works, until it doesn't.  It will end with the destruction of our current system... be that at the hands of A) deflationary collapse B) hyper inflationary chaos C) WWII or D) any combination of A, B and/or C doesn't really matter.  The dollar system is rapidly coming to an end and will be replaced by something else.

jcpicks's picture

Gold, silver and platinum bitchez!

SafelyGraze's picture

something similar in the fomc minutes: money printers on strike due to harsh conditions printing dollars. hence the shortage.

currency, especially the hard-to-mine high-denomination kind, is rare. that's why its value is going to the moon.

[meme stolen from houseofthemoon]

ArrestBobRubin's picture

Silver ain't chopped liver either, it will be up over 3% today alone. Started the week around 28...

If you like your Metals green, check this out:

Quinvarius's picture

The general rumor is that the paper games have hit the physical wall.  LBMA refusing to deliver silver outside of the LBMA.  JPM taking shots to the keyster.  SLV emptied to keep the COMEX and LBMA afloat.  SLV gonna cash out in fiat to stop the paper bleeding on its non-existant silver which is now just a paper liability for JPM.  Gruesome rumor mill.  It is the sound of inevitability, Mr Anderson.

CPL's picture

Correct for $400 Quinvarius.  It wasn't hard to make the assumption that everyone "in charge" is lying.  I'm not sure who would be fool enough to swallow anything offered from TPTW: The powers that were.

sampo's picture


GetZeeGold's picture



Tonto.....go to town and get us some silver.


Peter Pan's picture

For how long can they supress the price of gold and silver by paying workers dismal wages and having them live and work under conditions that even American pets don't experience.

GS-DickinDaMuppets's picture

Be very careful here in raising your PM positions.  I would not be surprised to see JPM et all drop these markets 5% or more in a heart beat....word to the wise, not a prediction, but be careful...


...doing GOD's work...DickinDaMuppets

Vooter's picture

If you've been a disciplined PM accumulator, it doesn't matter. Count your holdings in ounces, not dollars...

Bay of Pigs's picture

SLV adds 51 metric tons of silver? LOL. Who believes this bullshit anymore? 

This is a shell game at its best, or an outright ponzi at worst. These numbers have no connection to real world supply/demand fundamentals.

Vooter's picture

"These numbers have no connection to real world supply/demand fundamentals."

Sure they do--they're a perfect barometer of the oversupply of fiat garbage and the demand for real, tangible wealth...

balanced's picture

"44 people died during strikes"

(Goldcore) cowards. 44 people were murdered during strikes.

Oldrepublic's picture

I am glad that one commentator this morning made mention of the fact that

44 people were murdered by the police in South Africa.

some background

ArrestBobRubin's picture

I agree. Thing is, if they were 44 {more} murdered white farmers in S. Africa, their deaths wouldn't even be deemed newsworthy. Now how sick is that?

Overfed's picture

Well, those evil white people had it coming. /s

Dr. Gonzo's picture

Rhodium bars....If you have to have them for your collection like me you might as well get them cheap while the world is in a depression...and before people realize it's almost 10 times as rare at platinum and 30 times as rare as palladium and could ultimately get pinched ever harder over this S.A. crisis. Has yet to move from the current crisis unlike platinum which has surged over 10% in a week.

Overfed's picture

The problem with Platinum group metals is that it's their high-tech applications that make them valuable. If shit gets really bad, their value could plummet and stay down for a very long time.

In other words, buy physical silver and gold while you still have some $$ to work with. IMO.

Dr. Gonzo's picture

You could say that for silver too. Noble Metals are a good hedge for when the economy turns around...if it ever does. I have strong hands. I Don't plan on selling any and it's a hell of a lot better to have a bar of platinum than a grand piano or wad of $100 clown bucks if the fiat does go tits up. A lot easier to use as money anyway but not as good as silver/gold.

DoChenRollingBearing's picture

@ Dr. Gonzo

+ 1  Thanks for the link.

fiddler_on_the_roof's picture

The spread between "bid" and "ask" for these industrial metals - rhodium, platinum, silver is 10 times that of Gold. During times of stress

the spread for these metals are still wider. When you try to sell/buy, Dealers make a big chunk from the transaction unlike Gold.


So I will stick with Gold, which Central bankers hold. No need rhodium, platinum, silver.

Dr. Gonzo's picture

Don't care about bid/ask. I'm in it for at least 10 years. Do you know how different the world will look in 10 years? If they do take off in a new supply/demand paridigm and a new world where petrol dollars have little influence then today's bid/ask will seem insignifigant. I'm willing to thow some money on this gamgle any way. 100 times fewer than gold. If the COMEX gets broken it's a whole new ball game anyway. Nothing against gold or silver. I like to look at things that no one is looking at and no one is talking about.

edifice's picture

Bought a little physical platinum about a month ago. Glad I did...

Munkey's picture

I wonder if Blythe Masters is on the phone to Benny saying something like "Ben, it's real fucked up I can't put Jamie on, there is too much heat...listen Ben, we need some hard and heavy printing or this ship is going down...for fucks sake Ben cut the muppet talk!"

mrfreeman's picture

Be vewy vewy careful, Gold RSI 69, Silver RSI 76!!!

Can they continue rallying without ACTUAL QE announced?  This is such a joke, it's artificial volatility created by the money masters to make money FROM the volatility.  That is all.  Next week, the Bernankster will pour cold water on the market to cool things off a bit.  He just needs the stock market supported roughly where it is as we go into the election. 

aka Gil's picture

Yea but if he pours too much cold water on this, his current boss is fucked come November. Treacherous waters ahead for Ben Bernankster, the momentum crowd and the sitting administration.

TheCanadianAustrian's picture

I'm still waiting for APMEX to send me the 125 maple leafs that I ordered on the 10th. It's a kind of refreshing feeling to be on the winning side of a move in the market.

BeerBrewer09's picture


I also bought 50 Maples ~$27. Feels good.

SAT 800's picture

Always refreshing. Up over $10,000 per contract on my Dec. Silver bought at 28.08.