Sibanye-Stillwater (NYSE: SBSW)(JSE: SSW) has cut its 2026 US platinum group metals (PGM) production forecast by as much as 15% after a five-week strike disrupted operations at its Stillwater mine and Columbus metallurgical complex in Montana.

The South African miner now expects its palladium-dominated US operations to produce between 245,000 and 255,000 ounces of platinum and palladium this year, down from its previous guidance of 280,000 to 300,000 ounces, according to its third-quarter operating update released Thursday.

Production fell 19% year-on-year to 59,417 ounces during the September quarter, largely due to the strike, which ended Oct. 7.

The disruption has complicated Sibanye’s efforts to rebuild its US workforce and stabilize production ahead of 2027. Labour attrition accelerated during wage negotiations, leaving staffing levels about 25% below those planned for next year’s mechanized operations.

Production pressures

Sibanye said it would focus on rebuilding work teams and restoring output during the fourth quarter as its southern African operations also reported weaker production.

PGM output from its southern African mines declined 10% year-on-year to 458,202 ounces, reflecting planned reductions in surface production and depleting reserves at Kroondal.

Despite the decline, Sibanye maintained its full-year southern African PGM production guidance of between 1.65 million and 1.75 million ounces.

Gold production dropped 12% to 155,449 ounces as underground output from the company’s mature, deep-level mines fell 22%.

Higher commodity prices helped offset the operational setbacks, lifting group adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) by 9% year-on-year to 10.8 billion rand ($661.4 million).

Lithium uncertainty

Sibanye is also taking a cautious approach to its Keliber lithium project in Finland, delaying a fully integrated start-up as weak lithium market conditions raise questions about the timing of downstream refining.

The company said revised supply forecasts point to lithium production exceeding demand growth, creating a larger-than-expected market surplus in 2026.

“In response to lithium market volatility, the staged commissioning approach prioritises stable mining and concentrator performance before the refinery start-up, reducing integrated ramp-up risk and preserving capital flexibility,” CEO Richard Stewart said in the operating update.

The phased approach allows Sibanye to advance mining and concentration while retaining flexibility over when to begin producing battery-grade lithium hydroxide, which requires additional processing through a refinery.

The company describes Keliber, which began commissioning earlier this year, as the European Union’s most advanced integrated lithium project. It is designed to produce about 15,000 tonnes of battery-grade lithium hydroxide monohydrate annually for more than 18 years.

Hot commissioning of the concentrator continued during the third quarter, with further testing at design capacity scheduled for the final three months of the year.

Sibanye has previously indicated that it would decide on the timing of refinery commissioning in the fourth quarter, depending on lithium prices.

The decision will determine whether Keliber moves towards refined lithium production in 2027 or remains in a staged development phase while the company waits for more favourable market conditions.