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Wednesday, 23rd February 2005 (4519 views)

South African precious metal producers are likely to see their margins threatened and output squeezed in 2005, as a number of projects come under pressure from the strength of the rand.<br/> <br/>The growing strength of the rand has prompted industry observers to place question marks over a number of projects in the region, although some good news has been signalled from China.<br/> <br/>The rand has doubled in value against the dollar in the last four years, damaging the gold sector as the Treasury acknowledged in its 2005 Budget Review. <br/> <br/>"Certain sub-sectors, such as electrical machinery, furniture, and gold mining have not managed the competitive pressure of a strong rand,' the Treasury declared, according to reports on Bloomberg.<br/> <br/>Anglo American released its results today, corroborating the impression that the rand could pose more difficulties in 2005.<br/> <br/>However, finance director Tony Lea said that he expected commodity prices to remain steady, largely as result of the impact China is having on the market.<br/> <br/>The region's rapid consumer growth has helped spur a number of industries, with both the gold and platinum sectors reaping the benefits of the world's fastest growing economy.<img src="http://directnews.dehavilland.co.uk/dn.gif?feedid=196&itemid=7868887"/>

 

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