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Gold flat as Platinum and palladium rise on supply fears

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… South African police deployed to the platinum belt

…SPDR sees 2.39 T outflow, first drop since May 2

…Record US equities, dollar gain pressure gold (Adds comment, second byline, dateline, updates market activities)

NEW YORK – Platinum and palladium both rose nearly 1.5 percent on Tuesday on the back of lingering supply worries as South Africa sent more police to the strike-hit platinum belt to protect miners after four were killed returning to work over the weekend.

Gold prices, meanwhile, were little changed as investors digested news U.S. retail sales braked sharply in April but that did little to change views the economy was poised for faster growth this quarter. Record high in U.S. equities, measured by the S&P 500 which rose above 1,900 for the first time, kept a lid on the metal.

The four-month strike in South Africa, the longest and most costly bout of industrial action in the world’s top platinum producer, has halted nearly 40 percent of normal global platinum production.

“A sudden end to the strike would lead to a sharp drop but we believe the market is working under a structural production/consumption deficit and we are therefore bullish medium-to-longer term,” said James Steel, chief precious metals analyst at HSBC.

Spot platinum climbed 1.3 percent to $1,450.50 an ounce by 12:30 p.m. EDT (1630 GMT) and palladium was up 1.4 percent to $813.50 an ounce.

U.S. NYMEX platinum contract for July delivery gained $16 to $1,457.90 an ounce, with volume on track to finish sharply above its 30-day average, preliminary Reuters data showed.

Platinum stretched its premium over gold to its highest level since mid January at around $155 an ounce as producers pushed ahead with plans to resume production.

Palladium prices also climbed on supply worries due to continued tensions near the border of Ukraine and Russia, the top producer of the metal.

On Tuesday, six Ukrainian soldiers were killed and eight wounded in an ambush by pro-Russian separatists near the eastern Ukrainian town of Kramatorsk, according to Ukraine’s defence ministry.

GOLD INVESTMENT DEMAND SOFT

Tensions over Ukraine underpinned gold’s safe-haven appeal, but lackluster investment demand triggered bullion selling, traders said.

Investor wariness was already showing, with SPDR Gold Trust , the world’s top gold-backed exchange-traded fund, recording an outflow of 2.39 tonnes to 780.46 tonnes on Monday, the first outflow since May 2.

Spot gold inched up 35 cents to $1,295.65 an ounce, while U.S. COMEX gold futures for June delivery were up 30 cents to $1,296.10.

“What’s pointing to lower prices are the stronger equity markets, the firmer dollar,” Commerzbank analyst Daniel Briesemann said.

The dollar index rose against the euro and a basket of other currencies after a sharp decline in investor morale in Germany, Europe’s largest economy.

U.S. equities were up slightly after the S&P and Dow both rose to intraday record highs earlier.

The yellow metal is still up 7 percent this year due mainly to a strong first quarter, with prices little changed from the beginning of April.

Among other precious metals, silver was barely changed at $19.51 an ounce.

– REUTERS

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Business

Nigeria set to boost Naira value and foreign reserve with local gold production, as Tinubu receives gold bar

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IN  a significant move to strengthen Nigeria’s economy, President Bola Tinubu received a symbolic gold bar on Sunday from the Minister of Solid Minerals Development, Dele Alake.

This gesture marks the commencement of the National Gold Purchase Program (NGPP), aimed at boosting the naira’s value and enhancing the country’s foreign reserves.

Minister Alake expressed gratitude to President Tinubu for his support of reforms in the solid minerals sector.

He highlighted that the NGPP, which involves sourcing gold from artisanal and small-scale miners and refining it to meet the London Bullion Market Association’s Good Delivery Standard, will substantially contribute to Nigeria’s economic stability.

Alake stated “This initiative will significantly increase our foreign reserves and strengthen the naira. The refined gold will be supplied to the Central Bank of Nigeria, marking a crucial step in our economic strategy.”

The presentation also underscored the first commercial transaction under the NGPP, establishing a centralized gold purchasing system that integrates small-scale miners, cooperatives, and production units across the nation.

This program is expected to provide a structured market for gold, fostering economic growth and stability.

He said, The successful completion of the first commercial transaction clearly demonstrates the National Gold Purchase Program’s effectiveness. It has increased the nation’s foreign reserves assets and shown that using the Nigerian Naira to purchase a liquid asset traded in United States Dollars, such as gold, is a viable strategy. This transaction has also underscored the potential of the National Gold Purchase Program to enhance fiscal and monetary stability.”

Alake added that the initial commercial transaction under the program resulted in a +US$5 million boost in Nigeria’s foreign reserve assets.

The transaction involved refining over 70 kilograms of gold to meet the London Bullion Market quality standard and aggregating locally mined gold, thereby infusing approximately NGN6 billion into the rural economy.

President Tinubu expressed appreciation for the Ministry’s accomplishment in advancing the government’s goal of economic diversification by acknowledging and displaying the symbolic gold bar

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Solid Minerals

FG Fingers Foreigners Sponsoring Banditry For Illegal Mining

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The Nigerian Government has threatened to come down heavily on foreigners sponsoring bandictory as a way of sustaining illegal mining activities in parts of the country.

The warning was handed down in Abuja by Minister, Solid Minerals Development, Dr Oladele Alake, while receiving a delegation of the Nigeria-China Chamber of Mines led by its National President, Dr. Olugbenga Ajala.

Details of these were contained in a statement released by Head, Press & PR, Ministry of Solid Minerals Development, Alaba Balogun over the weekend.

The statement cited, Dr Alake, thus, “The government will come down firmly on these unscrupulous foreign operators sponsoring banditry to perpetrate illegal mining: let me use this medium to appeal through you to tell those sponsors to desist or face the full wrath of the law.”

According to Dr Alake, the Ministry is committed to establishing a multi-agency task force that will end the activities of illegal miners and their collaborators.

The Minster made it clear that the FG had given illegal miners a 30-day-ultimatum to legitimise their businesses, quit Nigeria or incur the wrath of the law.

According to him, this will help “to streamline and structure the Small-Scale Artisanal Miners for maximum yield to the Federal Government.”

The delegation paid a courtesy call on the Minsiter at the Ministry’s headquarters in Abuja.

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Energy

Fuel Scarcity: Govt Yet to Increase Pump Prices – NMDPRA

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A long queue at an NNPC fuel station

By Edozie Obasi-Eze

 

Amidst heightening uncertainties in the domestic petroleum products market characterised by scarcity and irregular pricing, the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has declared that there’s no intention to review pump prices upwards.

This was contained in an advisory issued by General Manager, Corporate Communications, NMDPRA, Kimchi Apollo.

He stated that the Nigerian National Petroleum Corporation Limited (NNPCL) had imported PMS with current stock levels sufficient for 34 days.

In an attempt to address panic buying and speculations which have seen price of Premium Motor Spirit (PMS) oscillate between N180-N250 in the Lagos area, Apollo assured that there was enough quantity of the product in the country already.

He said, “Consequently, marketers and the general public are advised to avoid panic buying, diversion of products and hoarding.

“In keeping with the Authority’s responsibilities as outlined in the Petroleum Industry Act (PIA), the Authority assures the public that it would continue to monitor the supply and distribution of petroleum products nationwide, especially during this holiday season.”

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