Unpacking the Nature of Demand and Supply Relationships in the Mining Capital Goods and Services Cluster: The Case of PGMs

South African policy makers and industrial planners are centrally concerned with identifying strategies and programmes that maximise and broaden the economic linkages that naturally arise from the need to extract, process and refine the country's mineral resources (DST, 2002; DTI, 2002). At an industry level these linkages encompass 'downstream' (beneficiation) activities, 'backward' linkages (the supply sector), and 'lateral' linkages (arising from the modification and application of generic technologies to other industry sectors). While the need to increase the level of value added/beneficiation to primary resources prior to export has received a considerable amount of attention in recent years (see Jourdan, 1992; Baxter, 1994; RSA, 1998; Chamber of Mines, 2000; MMSDsa, 2002, Metcalfe, 2003), there is a relative paucity of studies that explore the backward linkages arising from the mining sector.