Mining runs on two clocks: what you can dig, and what the world will pay for it. In its third quarter, Tharisa got the first clock ticking again. The platinum-group-metals and chrome producer, listed in Johannesburg and London, lifted quarterly output of those precious metals by 15.5% to 39,600 ounces after weather disruptions had held it back the quarter before.
Digging its way back
The rebound came from the mine itself. Tharisa recovered from weather-related interruptions to lift the amount of ore mined by 41.6%, while the share of metal it pulled from that rock improved to 83.8%. Chrome output eased slightly to 393,800 tonnes on lower milled volumes but held broadly steady. Tharisa's chief executive called it a quarter of normalised operations, and said year-to-date production keeps the group on course for its full-year targets of 145,000 to 165,000 ounces of platinum-group metals and up to 1.65 million tonnes of chrome.
Prices cool, spending climbs
The second clock was less kind. Tharisa's average basket of platinum-group metal prices fell nearly 12% from the prior quarter to US$2,681 an ounce after a long rally, as a stronger dollar, higher yields and renewed Fed hawkishness outweighed supportive fundamentals. Even after the pullback, prices stayed well ahead of where they sat a year earlier, and the company expects the medium-term fundamentals behind these metals to remain supportive. Chrome held firmer at US$306 a tonne before softening more recently, hit by weaker stainless-steel demand and Middle East tensions in a region that accounts for roughly 15% of global stainless consumption. Meanwhile heavy spending on the Tharisa underground project and the Karo Platinum development, including an US$80m loan drawdown, lifted debt to US$188.1m and cut net cash to US$10.7m, from US$54.7m three months earlier. The chief executive said the group had continued to invest through the cycle, pressing on with both projects on a planned and disciplined basis while keeping a positive net cash position. Even so, the group ended the quarter with close to US$200m of cash on hand.
Both projects are still moving: the underground portal is on track to deliver its first ore this quarter, and at Karo the mining contractor is in place with waste stripping under way. Investors have so far taken the long view, with the stock at R24.99 on Tuesday, up from R21.25 a year earlier.
