Platinum prices fell to their lowest in more than two weeks early on Thursday, reversing initial gains after South Africa's biggest platinum producers offered to raise wages for miners in a bid to end a 13-week-old strike that has curbed metal output. Anglo American Platinum Ltd and Impala Platinum Holdings Ltd said they have tabled a strike settlement offer to end the debilitating strike, South Africa's longest and most damaging mining strike in living memory.
The country produces 40 percent of global output for platinum, which is mostly used by the auto industry as catalytic converters or consumed as jewellery products. Signs of progress in talks between the world's biggest platinum producers and the AMCU union representing its 70,000 striking members have already pressured platinum prices after they hit a one-month high at about $1,470 an ounce on Monday.
"The strike was last bastion supporting the bullish case for platinum this week. That was the only thing holding the market up," said Frank McGhee, head precious metals dealer at Chicago commodities brokerage Alliance Financial LLC. Platinum was down 1.1 percent to $1,415.99 an ounce by 1:41 pm EDT (1741 GMT). US NYMEX contract for July delivery settled down $9.10 at $1,428.70 an ounce.
Palladium also reversed early gains, falling 0.3 percent to $795 an ounce. Among other precious metals, signs of weaker investment demand weighed down on gold. Holdings in the world's biggest exchange-traded fund, SPDR Gold Trust, fell 8.39 tonnes to 798.43 tonnes on Wednesday, the biggest daily outflow since late December. Spot gold was down 0.7 percent at $1,293.81 an ounce.