Platinum prospects will slip further against palladium

Subject

Platinum and palladium prospects.

Significance

The fortunes of the members of the platinum group of metals (PGM), most used by the automotive industry in catalytic converters for vehicle exhaust systems, are diverging. Last month, platinum, used in diesel-vehicle catalytic converters, fell to a 16-year low against palladium, mostly used in catalytic converters for petrol and hybrid powered vehicles.

Impacts

• Supply chain consolidation is underway; Northam, South Africa's fourth-largest PGM miner, has bought a US auto-catalyst recycling plant.
• Leading refiner Johnson Matthey will invest 200 million pounds (267.7 million dollars) to develop advanced batteries for electric vehicles.
• The boost from the need to replace vehicles damaged by the US hurricanes is partially being offset by an accelerated supply of scrap metal.
• Russia's Norilsk Nickel is creating a 600 koz Palladium Fund to buy excess metal and control flows to customers.