Tharisa CEO on why he believes we are entering a commodity super-cycle

Tharisa, a resources group, has recently announced a remarkable 492% surge in its headline earnings per share for the six months ending in March compared to the previous year. The company's success can be attributed to the rising commodity prices, resulting in a net cash balance of nearly $30 million. In a recent interview on CNBC Africa, Tharisa CEO, Phoevos Pouroulis, discussed the current state of the commodities market, shedding some light on the possibility of entering a commodity supercycle. Pouroulis expressed his belief that the current uptick in commodity prices exhibits all the hallmarks of the beginning of a supercycle. The demand for commodities is surpassing the supply, particularly evident in the platinum group metal basket prices. Despite the challenges posed by the COVID-19 pandemic, the demand for chrome, used in stainless steel production, has remained robust. Pouroulis highlighted the growth in stainless steel demand even during the pandemic, indicating a positive outlook for the industry. One of the key factors driving the elevated prices of the platinum group metals is the increasing emission standards globally. With a focus on decarbonization and improving air quality, stricter emission regulations are boosting the demand for autocatalytic converters, where platinum, rhodium, and palladium play crucial roles. Pouroulis also emphasized the potential of platinum in fuel cell technology and the hydrogen economy, suggesting a strong pricing environment supported by growing demand in the medium term. Tharisa's commitment to shareholder value was underscored by Pouroulis, mentioning the company's consistent dividend payouts over the past six years. He reassured shareholders of the company's intention to maintain its dividend policy, which entails returning around 15% of net profit after tax to shareholders. With a positive outlook for increased production growth in the next six months and favorable pricing dynamics, Tharisa aims to generate more cash and potentially consider an upsized dividend at year-end or even a special dividend in case of super profits. Pouroulis also shared insights into Tharisa's expansion plans in Zimbabwe, highlighting the exciting prospects that the region presents for the company. The company has a significant presence in Zimbabwe's platinum group metals sector, particularly through its ownership of Kaura Platinum. Following a second-phase exploration program, Tharisa is on track to declare the resource estimate soon, paving the way for further development and potential growth opportunities. Additionally, the acquisition of Celine Chrome in Zimbabwe is set to enhance Tharisa's chrome concentrate production, aligning with its strategy of diversification. Overall, Tharisa CEO Phoevos Pouroulis remains optimistic about the company's future amidst the current commodity boom. With a strong focus on operational efficiency, dividend payouts, and strategic expansion, Tharisa is poised for continued success in the evolving commodities market.