Platinum’s run to record highs will need to be sustained for miners to invest heavily in new projects, with executives signalling they plan to prioritise shareholder payouts for now amid concerns over past missteps and rising costs.
After years of margin pressure that forced deep cost cuts and mass layoffs, the rebound in platinum prices — with spot platinum hitting a record $2,918.80 per ounce in January after surging 127% in 2025 — has lifted miners’ fortunes.
Valterra Platinum, the world’s biggest platinum producer by value of sales and spun off from Anglo American last year, expects annual profit to jump by as much as 106%. Impala Platinum has forecast half-year profit growth of up to 392%.
But that doesn’t mean a spending spree is coming.
“We’re still maintaining our discipline, being really disciplined around executing what we can control within the business and then making sure that whatever additional value that we create, we return it back to shareholders,” Valterra CEO Craig Miller said on the sidelines of a mining conference in Cape Town.
Valterra plans to keep its 40% dividend payout policy.
Zimplats, Zimbabwe’s largest platinum producer and majority owned by South Africa’s Impala, is also preparing to reward shareholders after they backed the company’s 10-year, $1.8 billion expansion plans announced in 2021.
“We certainly look forward to an opportunity where we can reward them, in terms of giving them a dividend,” Zimplats CEO Alex Mhembere said.
Zimplats last declared a dividend in the financial year ended June 2023.
NEW OUTPUT CAUTION
Despite strong prices, mining executives are wary of launching new projects without evidence of sustained long-term platinum group metals (PGM) price stability, as costs are still weighing heavily.
“PGM prices today are not far off what we think is that price that you’d be able to earn a reasonable return on a new mining project,” said Valterra’s Miller, adding he would prefer a period of consistently higher prices to support greenfield development.
He said past platinum booms triggered unsustainable investment, noting that probably only two of 20 projects launched by the industry between 2005 and 2010 remain operational.
Miller cited sustained prices of $2,300 to $2,500 per ounce as a reasonable range for long-term planning.
Hilton Ingram, Valterra’s executive head of marketing, pointed to long-term average price forecasts rising by only 5% to 10%, which he said was not enough to spur greenfield output or reopen mothballed assets.
Sibanye Stillwater CEO Richard Stewart said that any decision to restart its Stillwater West mine in the U.S., placed on care and maintenance in 2024, would depend on a long-term view of the palladium market rather than short-term price moves.
Platinum and palladium – both used in autocatalysts that reduce vehicle exhaust emissions – have surged since the second half of 2025, driven by a supply deficit that has helped offset long-term headwinds from the shift to electric vehicles.
COST PRESSURES
Rising energy and labour costs in South Africa, the world’s biggest PGM producer, remain a major concern for miners.
An S&P Global report in January projected all-in sustaining costs (AISC) for primary platinum production would rise 7.7% to $1,006.14 per ounce in 2026.
“Persistent inflation, higher energy and labour costs, and the geological challenges of mining deeper, lower-grade ore bodies will continue to exert upward pressure on the AISC,” the report said.
While South African utility Eskom has stabilised electricity supply after years of severe outages, soaring power costs continue to squeeze miners. Electricity prices for large users have risen more than 900% since 2008, according to the Minerals Council.
“The constraint on growth within the PGM industry is not a question of incentive pricing,” said Sibanye’s Stewart. “It’s a lot more complex than simply a trigger price that will incentivise new production.”
(Additional reporting by Nelson Banya)
