Platinum Hits Three-Week High as South Africa Unrest Lingers

--Platinum futures gain 0.8% to $1,503.40 after brief strike at major producer Tuesday

--Strike follows killing of union leader last week, strike at Glencore Xstrata mines

--Gold rises after U.S. ADP employment report, but bounce fades

--Comex August gold trades up 0.3% at $1,400.70

 
   By Matt Day 
 

NEW YORK--Platinum futures rose to a three-week high Wednesday on worries about fresh strikes in top producer South Africa.

Thousands of workers at Impala Platinum Holdings (IMPUY, IMP.JO), the second-largest platinum producing company, staged a brief strike Tuesday before resuming work overnight, the company said.

The most actively traded platinum contract, for July delivery, was recently up 0.8% at $1,503.40 a troy ounce on the New York Mercantile Exchange. Futures earlier hit the highest intraday price since May 14.

But stoppage was the latest sign of renewed tension in South Africa's mining industry, which last year churned out 73% of the world's platinum output, according to specialty chemicals company and major industrial precious metals user Johnson Matthey PLC.

A union leader was killed and another wounded in a shooting at a Lonmin PLC (LMI.LN, LNMIY) office last week. The same Lonmin mine was the site of a two-day strike last month, and in August clashes between police and protesters there left 34 protesters dead.

Lonmin spokeswoman Sue Vey said the atmosphere at the mine was "fragile" on Wednesday. "You can feel the fragility of it," Ms. Vey said.

Meanwhile, Glencore Xstrata PLC (GLNCY, GLEN.LN) on Monday dismissed about 1,000 workers who went on strike at three of its chrome mines in South Africa.

"South African unrest continues," said Peter Hug, director of trading with Kitco Metals, lending a "bullish tone" to platinum.

Gold futures pointed higher on Wednesday after a report on U.S. hiring came in weaker than expected.

The most actively traded gold contract, for August delivery, recently traded up $3.50, or 0.3%, at $1,400.70 a troy ounce on the Comex division of the Nymex.

Payroll processor ADP said the U.S. private sector added 135,000 jobs last month, below the expected gain of 170,000. Gold had traded at about $1,400 a troy ounce in the minutes before the data, and climbed as high as $1,409 an ounce after its release.

Gold prices have been under pressure for much of this year as a strengthening U.S. labor market increased the perceived likelihood that the Federal Reserve would pull the plug on its stimulus measures.

Some investors see gold as a hedge against the inflation that can follow such policies. Easy-money programs from the Fed and other central banks have been a key support for gold prices in recent years.

-Devon Maylie contributed to this article.

Write to Matt Day at [e-mail]