SMM: Silver Market Remains Bullish Amid Rare Backwardation and Tight Supply

[SMM Flash] Zimplats has made significant progress in recovering delayed payments under Zimbabwe’s export-surrender regime after reaching an offset arrangement with government institutions, according to comments by Implats CFO Meroonisha Kerber during the group’s FY2026 results call. Under the surrender policy, exporters receive 70% of export proceeds in US dollars and 30% in local currency (ZiG). Delays in settling the local-currency component had left Zimplats owed the equivalent of US$78.1 million at end-December 2025. Under a tripartite arrangement reached around March, Zimplats now receives 50% of its surrender proceeds in cash while the remaining 50% can offset government obligations. The company has since used about US$99 million against taxes, royalties and customs duties and gained access to roughly US$150 million in local currency, bringing local creditors up to date. The arrangement reduces working-capital pressure at a major Zimbabwean PGM producer, although it does not represent a change to the underlying 70:30 export-surrender policy.

[SMM Flash] African Rainbow Minerals (ARM) reported R3.20 billion in headline earnings for FY2026, up 19% year-on-year, supported by sharply higher PGM prices. ARM Platinum contributed R1.35 billion, reversing a R1.29 billion loss in FY2025. At Two Rivers and Modikwa, US-dollar 6E basket prices rose 68% and 65%, respectively. However, physical output remained subdued: Two Rivers production fell 1% to 286,590 6E oz while Modikwa declined 3% to 273,671 6E oz. Unit cash costs increased 13% and 8%, respectively.​ The results show that stronger PGM pricing is materially improving South African producer margins despite continued cost and production pressures. Two Rivers’ cash operating margin increased to 37% from 17%, while its PGM cash operating profit rose to R3.48 billion. ARM also confirmed approval of the 180,000-tonne-per-month Bokoni development project following completion of its definitive feasibility study. The project carries estimated nominal capital expenditure of R15.2 billion, potentially adding a significant longer-term source of South African PGM supply.

Zimbabwe is accelerating the transformation of its mineral sector, shifting away from traditional mining and raw‑material exports toward processing, refining and downstream manufacturing. Tafadzwa Chinamo, CEO of the Zimbabwe Investment and Development Agency (ZIDA), stated that the country aims to attract more capital into mineral separation, smelting, refining, chemical processing and mineral‑related manufacturing, to retain greater mineral value domestically and expand its industrial base.