Palladium, that other platinum-group metal (PGM), which has been
struggling under the burden of diminished demand over the last two
years, could be set for something of a comeback as a broad base of
PGM consumers seek a sub-stitute for high-priced platinum.
In its first platinum-and-palladium survey, published earlier this
month, GFMS, the London-based precious-metals researcher, forecast
that the prevailing price differential between platinum and
palladium will narrow, and that the consuming markets are already
responding to the massive premium that platinum currently commands
over palladium.
GFMS CEO Pastone powder crushing equipmentul Walker said at the launch of the 2003 survey in
Johannesburg that he predicts the palladium and platinum prices to
move closer together in the next 12 to 18 months, with platinum
moving down and palladium going up. Because of their similar
physical and chemical characteristics, the two metals are
inter-changeable in some of vendors of stone crusher equipment in indiatheir end-uses.
GFMS reports that the price swing between the two metals has
exceeded $1 100/oz since the peak of the palladium price spike in
2001, and consumers are rapidly becoming more flexible in their
ability to switch between, or mix, the two. It is especially in the
autocatalyst and jewellery serussian crushers machine suppliersctor that palladium is establishing a
stronger presence.
According to the survey, the increase in platinum offtake in the
vehicle emis-sion-control sector was 8% between 2002 and 2003,
reflecting tightening environmental requirements in some countries,
strong production of diesel-powered vehicles in Europe and thsilica quartz mineral resourcese
retrofitting programme in Japan for diesel filters on existing
vehicles.
Palladium’s fortunes were mixed, with use continuing to drop
as a result of technological changes in response to the
metal’s price spike in 2002 and 2001. However, this is now
being mitigated to some extent as auto companies respond to
platinucrushing and mining equipment in indiam’s current massive relative price premium over
palladium. A result of these relative price movements is the
renewed determination of auto companies to develop flexibility over
their comparative use of the metals.
According to GFMS, in 2003, jewel-lery fabrication accounted for
35% of global net platinum demand and for 5% of net palladium
demand. Platinum jewellery offtake slipped in most regions in 2003,
with the ex-ception of North America, which was marginally higher,
while global offtake in jewellery increased by 8%.
The most important jewellery market for PGMs is still China, with
55% of global net demand for jewellery in 2003. This proportion is
down from 60% market share in 2002, with margins forcing
fabricators to reduce inventory levels and also to diversify into
other white metals.
While white gold is a notable benefi-ciary of this philosophy,
palladium has also been making significant headway in the Chinese
jewellery market in its own right.
In terms of overall PGM supply in the market, Walker says both
platinum and palladium are in fundamental deficits that have, to
date, been met by the mobilisation of aboveground inventory,
principally from Russia and the automotive industry. The key issue
is how much longer these circumstances will persist, he notes.