TOKYO -- Japan will obtain rights to buy platinum group metals worth a fifth of its annual consumption from South Africa, securing a stable future supply of the metals vital to making car exhaust filters and fuel cell vehicles.
Japan Oil, Gas and Metals National Corp., or Jogmec, will announce the deal on Friday with its partners. The state-owned company created a joint venture in 2009 with Canadian and South African partners and has surveyed areas around the northern province of Limpopo for reserves of platinum group metals including palladium. South Africa is home to a majority of global reserves of these metals.
Jogmec put up 9.75% of its 21.95% stake in the joint business for sale via competitive bidding, with Japanese metal trader Hanwa submitting the winning bid. Hanwa will obtain preferential rights to buy all of the project's output rather than just a portion commensurate to its stake, as well as rights to purchase such byproducts as nickel and copper. Production will begin as early as 2022.
Japan's Ministry of Economy, Trade and Industry considers this operation one of the most price-competitive in the world. The project will churn out 23 tons of platinum group metals per year at a cost that is half the market price.
Platinum group metals are used in fuel-cell electrodes and catalytic converters to clean the exhausts of gasoline- and diesel-fueled vehicles. Competition has been intensifying worldwide to secure a steady supply of these metals.