PRECIOUS-Platinum hits 3-month high on supply worry, gold up

Tue Jan 15, 2013 1:35am IST

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* Platinum rallies ahead of Amplats operational review
    * Platinum discount to gold narrowest in nine months
    * Gold underperforms platinum, investors cautious
    * Coming up: U.S. Fed chief Ben Bernanke speaks 4 p.m. EST


    By Frank Tang
    NEW YORK, Jan 14 (Reuters) - Platinum rose to a three-month
high on Monday, and is on the brink of being on parity with
gold, as the prospect of further supply outages in South Africa
triggered strong buying by commodity funds.
    Gold edged up, but trailed platinum's rise, helped by gains
in agricultural and energy prices.
    Platinum prices received a boost on news that South Africa's
Anglo American Platinum is likely to sell or shut its
Union mine as part of a review of its platinum business by
parent Anglo American.
    Expectations that such action will further tighten the
platinum market, which was expected to post a deficit this year,
is pushing platinum back towards parity with gold for the first
time since April last year.    
    "Platinum prices definitely have room to move higher," said
Howard Wen, metals analyst at HSBC. 
    Wen cited strong performance of the U.S. platinum
exchange-traded funds and an increase in bullish bets by hedge
funds and money managers showed by CFTC data.
    Spot platinum was up 1.6 percent at $1,655.50 an
ounce by 2:49 p.m. EST (1949 GMT), having earlier touched its
highest since mid-October at $1,660 an ounce. 
    U.S. April NYMEX platinum futures settled up $27 at
$1,658.20 an ounce, with trading volume about 30 percent above
its 30-day average, preliminary Reuters data showed.
    Platinum's discount to gold narrowed to around $10 from
about $140 at the start of the year.  
    Analysts are expecting the review at Amplats, the world's
top platinum producer, will lead to at least some shaft closures
due to soaring costs and falling profits.
    Recent encouraging U.S. auto sales data also boosted fund
buying in platinum and palladium, which are mostly used in
catalytic converters to clean exhaust fumes in vehicles.
    Palladium rose 0.2 percent to $697.70.
  
    GOLD EDGES UP, AWAITS BERNANKE 
    Spot gold was up 0.3 percent at $1,666.65 an ounce,
while U.S. COMEX gold futures for February delivery
settled up $8.80 an ounce at $1,669.40, with trading volume
about 20 percent below its 30-day average.
    Bullion investors remained wary towards gold after it
recorded its biggest quarterly drop in more than four years in
the last three months of 2012.
    Financial markets were awaiting a speech later in the day by
Federal Reserve Chairman Ben Bernanke. Attention will focus on
any further indications of how long the U.S. central bank's
latest bond buying program will last.
    In the longer term, gold may derive support in coming months
from discussions over the raising of the U.S. debt ceiling.
    "We view the recent sell-off as a good entry point to
re-establish fresh tactical longs in gold before the run up to
the debt ceiling debate, which we view as a likely catalyst for
higher gold prices," Goldman Sachs said in a note. 
    Goldman, however, said that it expects gold prices to
decline as better U.S. economic data overrides further easing. 
    Silver gained 1.9 percent to $31.01 an ounce.
 2:49 PM EST     LAST/    NET   PCT      LOW    HIGH  CURRENT
                SETTLE   CHNG  CHNG                       VOL
 US Gold FEB   1669.40   8.80   0.5  1659.50 1674.80  114,123
 US Silver MAR   31.11  0.702   2.3   30.380  31.170   37,990
 US Plat APR   1658.20  27.00   1.7  1628.30 1665.00   14,103
 US Pall MAR    703.30   1.85   0.3   696.25  709.95    2,765
                                                               
 Gold          1666.65   4.21   0.3  1660.65 1674.40         
 Silver         31.010  0.580   1.9   30.410  31.120
 Platinum      1655.50  26.75   1.6  1631.75 1660.00
 Palladium      697.70   1.40   0.2   695.00  707.50
                                                               
 TOTAL MARKET              VOLUME          30-D ATM VOLATILITY
                CURRENT   30D AVG  250D AVG   CURRENT     CHG
 US Gold        142,853   143,010   174,260     13.88   -0.38
 US Silver       41,458    41,113    53,242     22.09   -0.48
 US Platinum     14,211    14,862    10,623     17.32    0.06
 US Palladium     2,802     3,465     4,795
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