The US platinum and palladium producer Stillwater Mining has been awarded a BB- credit rating and an outlook of "stable" by Standard & Poor's (S&P).

The ratings agency explained that Stillwater's rating is a product of the company's limited operating diversity, high cost profile and volatile metal prices, Platts reports.

The lack of operating diversity stems from the fact that Stillwater's production comes from only two underground mines, which leaves it vulnerable to disruptions.

S&P added that palladium and platinum sales were also concentrated to three customers - General Motors, Ford Motor, and Mitsubishi.

However, S&P said that favourable supply contracts and moderate financial leverage partially offset these factors.

Stillwater produced around seven per cent of the world's platinum in 2003 and accounted for two per cent of total palladium output.

Russian-based Norilsk Nickel is the main shareholder in Stillwater, owning 56 per cent of the firm.