Precious Metals

Palladium price surges amid supply crunch

Russia’s Norilsk Nickel has increased production of palladium to help meet market demand.

Coin courtesy if APMEX; background image courtesy of Norilsk Nickel.

With palladium supplies tightening and the threat of miners’ strikes in South Africa, the price of palladium surged past $1,553 a troy ounce Feb. 26.

The platinum-group metal, like platinum itself, is used in autocatalyst applications to control motor vehicle emissions.

In 2019 alone palladium has climbed 21 percent in value. Palladium has risen steadily from a low of $235 per ounce in November 2008. In March 2008, platinum had hit a record topping $2,200 per ounce.

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This year, as of Feb. 26, palladium closed on the London market at $1,540 per ounce, while platinum closed at $859. Gold closed at $1,325.05 per ounce.

Possible strike looms

In addition to the tightening of supplies, labor unrest at some of the mines that produce palladium is also at play.

Miners at 15 different South African mines notified management of upcoming strikes by workers.

Combined, South Africe and Russia account for roughly 75 percent of the world’s annual palladium output. Russia is the top producer, with 81 metric tons recorded in 2017. Russia’s Norilsk Nickel is the biggest producer of palladium in the world, accounting for almost 40 percent of total production. Norilsk has been increasing its palladium supplies to support increased automobile and truck buying around the globe.

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