Palladium’s performance thus far in 2017 is outshining its
rivals among the precious metals, especially gold, according to market
analysts and other experts attending the London Bullion Market Association conference
Oct. 15 to 17 in Barcelona, Spain.
Presentations by market forecasters noted that the spot price of
palladium had spiked to $952 an ounce, a 40 percent hike compared to
last year at the same time, while gold had climbed 12 percent in the
same period, to just under $1,300 an ounce. The London PM closing spot
price for palladium reached $1,006 on Oct. 16, while gold’s spot price
closed at $1,303.30.
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Palladium, a platinum group metal, is used heavily as an auto
catalyst in automotive catalytic converters, to reduce harmful auto emissions.
Automobiles that use gasoline, diesel and other fuels are not yet
feeling any price pressure from strictly electric vehicles, which
utilize no catalysts.
“They're growing from a low base so it’s not really a threat to the
palladium market for the next 10 years,” said Denis Sharypin, head of
commodity research for Norilsk Nickel, during the LMBA conference.
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Nickel, a Russian mining and smelting operation for nickel and
palladium, is the world’s largest producer of palladium.
Sharypin projects that the increase in car sales globally will
necessitate an additional 2.5 million ounces of palladium through 2025.
Palladium demand is expected to outdistance the rate of increase in
supply over the next three to five years, says David Jolie, market
analysis manager at the South African-based Anglo
American, one of the world’s largest mining companies.