(Updates with quotes, closing prices, adds NEW YORK to
dateline)
By Frank Tang and Atul Prakash
NEW YORK/LONDON, Feb 15 (Reuters) - Platinum surged 3
percent to hit a record high for the 12th successive day on
Friday, with acute power problems in top producer South Africa
encouraging investors and consumers to buy up the metal.
Spot metal <XPT=> hit a high of $2,060 an ounce before
easing to $2,050/2,055 by 2:59 p.m. EST (1959 GMT), against
$1,997/2,007 in New York late on Thursday. It has jumped more
than 34 percent this year on the top of 37 percent gains
recorded in 2007.
"It's panic, panic, panic. If you are a platinum consumer,
you are not going to sleep at night," said Robin Bhar, metals
analyst at UBS Investment Bank.
"The price move shows you the unprecedented nature of the
market. People can see actual physical shortages somewhere down
the road and prices moving away from them. It's not a case of
just speculation. There is genuine demand coming through."
South Africa, which accounts for 80 percent of global
platinum supply, has been hard hit by power cuts since early
January, forcing mines to shut for five days last month.
South Africa's state power firm Eskom said on Thursday it
would increase coal purchases and buy back electricity from
those industrial users able to reduce consumption under a plan
to address crippling shortages. []
Analysts say the platinum deficit could widen to 400,000 to
500,000 ounces by the end of 2008, compared with about 265,000
ounces in 2007. The market had a surplus of 65,000 ounces in
2006 following seven successive years of deficits.
Impala Platinum <IMPJ.J>, the world's No. 2 producer, on
Thursday forecast "very tight market conditions." The top
producer Anglo Platinum <AMSJ.J> said this week the power
problem alone would cut output by 120,000 ounces in 2008. It
has shut it Polokwane smelter for weeks of repairs.
[]
However, some traders warned that a sharp pullback could be
possible after the white metal's breakneck rally.
"We already know that platinum is a news-driven market.
It's all coming out of South Africa. If everything stays the
same right now, and if the shortfall is not going to get
greater, this market will not go substantially higher," said
Ralph D'Esposito, NYMEX floor trader with RJ Futures in New
York.
D'Esposito said that even if Eskom went back to producing
at full capacity for only a week or two, the platinum market
could be vulnerable to a sharp pullback of as much as $200.
GOLD FALLS AS OIL RALLY FAILS
Gold reversed initial gains as a rally energy prices lost
steam. U.S. crude futures <CLc1> settled way off their intraday
highs at $95.50 a barrel.
Spot gold <XAU=> rose as high as $915.20 an ounce and was
at $903.00/903.80 an ounce by New York's last quote at 2:15
p.m., against $907.10/907.90 late in the U.S. market on
Thursday.
The gold contract for April delivery at the COMEX division
of the New York Mercantile Exchange <GCJ8> settled down $4.70
at $906.10 an ounce.
George Gero, vice president of RBC Capital Markets Global
Futures in New York, said that liquidation and short-covering
could be seen and an increase in volatility could be possible
in the near term.
However, Gero said that buying in gold was steady on
perennial economic worries and possible further rate cuts ahead
of the long U.S. weekend, Gero said.
Markets will be closed Monday in observance of U.S.
Presidents Day. []
Harmony Gold <HARJ.J>, the world's fifth-biggest producer,
posted a wider second-quarter loss per share after an accident
closed a mine and warned the power crisis was hitting output.
Palladium <XPD=> firmed to $444.00/449.00 an ounce from its
Thursday close of $433/437, while silver <XAG=> eased to
$17.11/17.16 an ounce from its previous finish of
$17.24/17.29.
