BizNews Radio

Mining guru Peter Major looks at the performance of the commodity sector during 2021, where prices seesawed over the course of the year. Despite the first six months seeing record prices across the board, commodity prices have fallen off a cliff in the second half. The last few weeks have been flooded with mergers and acquisitions activity, which historically has indicated the top of the commodity cycle and has concerned analysts. Impala Platinum has made a second attempt to takeover mid-tier precious metals producer Royal Bafokeng Platinum (RBPlats), with competitor Northam having recently acquired a third of the business for R17bn. Impala’s part-cash, part-share deal of R150 per share values RBPlats at R43bn. Glencore has been under pressure from activist shareholders to disinvest from its thermal coal operations, however, Major believes these cheap, attractive assets will continue to deliver good shareholder returns.

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The hard-hitting Magnus Heystek reviews the reasons for the outperformance of the BizNews share portfolio against some of South Africa's largest asset managers, as global equities leave local returns in the dust over the seven year period.

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Powerful arguments both for and against mandatory vaccinations featured in this episode of the BizNews Power Hour. In one corner is Discovery CEO Adrian Gore who argues that with SA now into the Fourth Wave of the pandemic, saving lives should be the national priority and as vaccines do this, jabs are a priority. On the other side are Sakeliga's Piet le Roux and Russell Lamberti who argue that forcing vaccines is disproportionate and unsuitable - and would put SA onto a slippery slope towards centralised control and authoritarianism. Also in this episode of BPH, Magnus Heystek references the BizNews Share portfolio's outperformance to prove his long stressed point promoting offshore investment - and Peter Major is so worried about commodity shares that he cannot find one to recommend for 2022.

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*After just a day, the Ballito Rage Festival has been cancelled. The annual event came to an abrupt end when party-goers and staff members tested positive for Covid-19. Despite strict protocol, including mandatory vaccination for staff and attendees, 32 guests and four staff members tested positive for the virus. The Department of Health was on-site and conducted contact tracing to ensure the isolation of those who tested positive. “We take the safety of all our customers, staff and suppliers extremely seriously. It is for this reason that the event organisers have taken the decision to cancel the remainder of Ballito Rage,” said organisers in a statement.

*The start of 2022 could see the South African Government introduce a Covid-19 vaccine passport system. President Ramaphosa has said although the government will consider a vaccine mandate, it would not compel citizens to receive the inoculation against their will. A passport system would restrict access to areas and public services.

*The Department of Mineral Resources and Energy has admitted to a mistake in the recently announced adjustments to the petrol price. Minister Gwede Mantashe said unleaded 93 and 95 petrol would increase by 81 cents on Wednesday. The price was supposed to go up by only 75 cents. In a statement, the department apologised for any inconvenience caused, noting it was the first time in the basic fuel price determination’s history that it made this mistake.

*South Africa’s Aspen Pharmacare is hoping to produce its brand of Covid-19 vaccine. According to a statement released by the Durban-based company, Aspen is hoping to enter into a licensing agreement with Johnson and Johnson, with the intention of manufacturing the vaccine under the Aspenovax brand name. Aspen plans on selling it to a number of African states.

A forthright discussion on mandatory vaccines with the Sakeliga duo of CEO Piet le Roux and chief economist Russell Lamberti explaining why forcing jabs is wrong. Their argument is premised on the basis that a mandate is disproportionate to the risk and unjustified on the grounds that very few people get mortally ill from Covid-19 - and that SA already has extremely high natural immunity to the virus. They also argue that the ANC government's track record suggests the project will become a honey pot for the corrupt, while also putting the country onto a slippery slope towards greater state control and authoritarianism.

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Discovery's co-founder and CEO Adrian Gore explains why his group - which relies heavily on incentivising its clients to behave in a certain manner - is at the opposiute end of the spectrum on vaccine mandates. For Gore, it's all about time - with SA now into a Fourth Wave of the pandemic and the efficacy of vaccines proven beyond doubt, the biggest challenge now is to save lives. In this discussion with BizNews.com's Alec Hogg he quantifies how a surge in vaccinations could save more than 30 000 lives.

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Stanlib’s chief economist Kevin Lings unpacks the latest unemployment data, which reveals a decimated South African economy. In the third quarter of 2021, 660,000 jobs were lost in the formal sector. This takes the total to 2.1 million jobs lost since the start of the pandemic. The unemployment rate rose to 34.9% from 34.4% in the second quarter. The broader definition – arguably a more accurate indicator as it includes discouraged workers – came in at a staggering 46.6%. Lings outlines the importance of the growth of small- to medium-sized businesses, which are the backbone of an economy. He lambasts policy for making business difficult in an environment where we should be promoting policies that uplift the economy. Lings says there aren’t too many positives to take out of the data; it paints a bleak macroeconomic picture in South Africa.  

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Banking analyst Kokkie Kooyman talks about his chosen stock pick in the financial services sector for 2022, naming Capitec. Capitec has been one of the best South Africa business stories since the start of the millennium and is now the country’s third-largest bank by market capitalisation. Under the stewardship of Gerrie Fourie, Capitec has continued to gain market share, becoming the low-cost banker to millions of South Africans. Despite analysts’ concerns surrounding its valuation, Kooyman says this is vindicated owing to its strong growth and innovation that keeps it ahead of its competitors. 

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In this episode of the BizNews Power Hour, Discovery CEO Adrian Gore lays out the case for making Covid-19 vaccines mandatory, arguing that forcing South Africans to be jabbed will save up to 40 000 lives during the Omicron-driven Fourth Wave; Stanlib chief economist Kevin Lings unpacks SA's shocking unemployment data where a further 660 000 jobs disappeared in Q3 (and youth unemployment hit 77%); Kokkie Kooyman shares his banking stock pick for 2022; and Anthony Sedgwick explains why ABAX (and other money managers) sold a chunk of RBH shares to Impala Platinum.

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News headlines:

*Unemployment in SA continued to accelerate in the third quarter, reaching 34.9%, up from 34.4% in the preceding three months, statistician-general Risenga Maluleke said on Tuesday.

*Analysts warn that the latest fuel price hikes taking effect from Wednesday will have a dire impact on consumers.

*Following reports that the government has finally decided to scrap e-tolls in Gauteng, transport minister Fikile Mbalula has issued a statement denying any such decision has been made.