Second-tier miners can often better reflect their markets' fundamentals than can industry leaders.

That is the case with annual results from platinum miners Aquarius and Northam. Both were affected by a strong rand, which negated much of the benefits of rising dollar prices for platinum. Meanwhile, both are expanding.

Aquarius Platinum is gradually moving beyond the technical and safety problems that have plagued it these past two years. But CEO Stuart Murray still had some reservations when he presented his company's results for the year to end-June 2010.

He pointed to rand-denominated platinum prices being between 6% to 8% lower than at end-June and 20% lower than at May's platinum price peak. That was not encouraging, he added, cautioning that something had to give. That might be a weakening of the rand or a curtailment of production by parts of the South African platinum industry, Murray said.

Northam's Glynn Lewis commented similarly on the drawbacks of rand strength. But this hasn't deterred it from taking the plunge on its R3.6-billion Booysendal mine, which it is reckoned will produce an annual 162000 ounces of 4E metals - platinum, palladium, rhodium and gold.

Of course, Northam's future ownership still remains in the air. Top management at the faltering Mvelaphanda Resources are scrambling to salvage as much value as it can from an essentially enforced unbundling. In April, Mvela sold a 12.2% shareholding in Northam to Eurasian Natural Resources and its residual 50.8% is now up for distribution.

Preliminary development of Booysendal is being funded internally. The bulk of later funding is slated to come from convertible bonds and bank debt. It could be a balancing act if there is any danger of its bringing downward pressure on Northam's share price. Soon, the shares will no longer have the implicit support afforded by Mvela's majority shareholding.

At Aquarius, the year's attributable production of the 4E metals fell for the third successive year in fiscal 2010, largely as a result of the temporary closure of the Everest mine. Everest is Aquarius's only wholly owned mine; the others are 50%-owned.

Following the past year's 422645 ounces of attributable production, Murray's 4E guidance for fiscal 2011 is 530000 attributable ounces. Of that, 220000 ounces are expected from the Kroondal mine, 120000 ounces from the re-opened Everest, 80000 from Marikana and 100000 ounces from Mimosa in Zimbabwe.

Despite suggesting the possibility of reduced production for SA's platinum sector as a whole, judging from his 2011 guidance, Murray does not envisage any such restraint by Aquarius. He reckons that Everest alone will raise output to a steady state of between 190000 ounces and 205000 ounces. And he took some comfort from indications that Chinese demand for platinum jewellery was firmer than expected at a price of $1500 an ounce.

Nonetheless he was not happy with operating cost trends, warning that higher labour and electricity costs in SA could result in an overall rise of 10% this year. In Zimbabwe, the rate could be double that. This after an overall dollars per ounce increase of 23% in the past year.

Aquarius has still to agree with its partners on the troubled Blue Ridge property. It has been a small mine, producing fewer than 60000 ounces a year and faces closure for seven months or more while it is made safe for employees.

In Zimbabwe, Mimosa is now producing close to its total 200000 ounces boiler-plate capacity after ramping up its Wedza mine expansion.

This year, too, will be burdened by a higher 4% royalties tax in Zimbabwe and, along with Northam, the full impact of the new royalties in South Africa.