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Originally Posted by Neuro
DON'T TAKE THE VACCINE!
THE SHIT HAS HIT THE FAN!
Neuro (26th September 2012)
Palladium appears to be kicking butt again.
Calling A North American Palladium Bottom
"...Johnson Matthey recently published a report calling for a huge deficit of palladium (915,000 ounces) due to lower supplies, higher gross demand and less recycling: palladium supplies are predicted to decline to a 9-year low of 6.57 million ounces, because of lower South-African output due to the strikes, which have hurt South-African production of platinum and palladium. Another factor contributing to lower supplies comes from a forecast drop of sales of Russian state stocks by over 0.5 million ounces compared with last year, to 250,000 ounces.
Recycling is expected to be constrained by subdued PGM (Platinum Group Metals) prices.
To read the full report, click here.
In a recent report, Stillwater Mining (SWC) wrote: "Palladium is facing a substantial supply deficit going forward that will likely be met by a combination of price-driven demand destruction and shifting back to platinum or using rhodium." ..."
LARGE PALLADIUM MARKET DEFICIT FORECAST FOR 2012
AUTOCATALYST DEMAND FOR PALLADIUM TO REACH RECORD LEVEL
The balance of the palladium market is forecast to swing by over 2 million ounces this year from surplus to deficit, due to lower supplies, higher gross demand and less recycling. Supplies will contract mainly because of lower sales of Russian state stocks, while recycling will be constrained by subdued pgm prices. Gross palladium demand is predicted to rise to 9.73 million ounces, driven by a return to positive net physical investment and higher autocatalyst purchasing, moving the palladium market into a deficit of 915,000 oz.
Supplies of palladium are predicted to decline to a nine-year low of 6.57 million ounces. Palladium supplies from South Africa are forecast to fall by 6% this year, to 2.40 million ounces, in line with lower underlying platinum output. Newly refined palladium supplies from Russia are expected to decrease due to a change in the ore mix and falling average grades. Sales of Russian state stocks are forecast to drop by over half a million ounces compared with last year, to 250,000 oz.
Purchasing of palladium by the autocatalyst sector is expected to rise by 7% to a new high of 6.48 million ounces. Demand for palladium is forecast to benefit from growth in global vehicle production, with the strongest performance in the principally gasoline markets of Japan and the USA, as well as continuing substitution of platinum in both light and heavy duty diesel aftertreatment formulations.
Industrial demand for palladium is forecast to soften by 3% to 2.41 million ounces. In electrical applications, a long-term trend towards using cheaper base metal alternatives to palladium in all but niche and high-end applications continues to drive demand lower. However, a wave of chemical plant construction in China will stimulate purchasing of palladium for new catalyst charges.
This year is set to mark the return to positive physical palladium investment demand, in contrast with the net liquidation seen in 2011. For the year as a whole, a change in investor sentiment towards palladium ETFs is expected to result in 385,000 oz of net new physical investment demand, a swing of 950,000 oz compared with last year.
Gross demand for palladium in jewellery is predicted to dampen by 11% to 450,000 oz. Purchasing of palladium by the Chinese jewellery sector is expected to decline once again as the metal continues to suffer from a lack of positioning and effective marketing, as well as competition from low-fineness gold alloys.
Supplies of palladium are expected to fall in 2013 as a result of lower output from Russia and the diminishing likelihood of a significant increase in output from South Africa. Another year of solid autocatalyst and industrial demand is forecast, together with higher returns of palladium from end-of-life vehicle recycling.
Linked above, but a good read:
Especially the bit about going from a 2:1 (Pd:Pt) exchange technology to a 1:1 exchange, making Pd much more valuable. I.e., with today's technology, 1 gram of Pd can replace 1g of Pt in a catalytic converter (gasoline and some light diesel, see text of article).
Palladium Fundamentals
Dominates Catalytic Converters – Confirming Positive Outlook
http://www.corporate-ir.net/media_fi...ons/md_pdf.gif Palladium Fundamentals
September 2012
"...The price-driven technological shift from "two-for-one" to a "one-for-one" substitution of palladium for platinum cemented the market going forward for palladium in gasoline converters. Gasoline catalytic converter technology worldwide is now almost exclusively palladium based, augmented with small amounts of platinum and rhodium where necessary..."
"...The average content of a catalytic converter in the three big car producing areas of the world is roughly as follows: 4 grams in North America; 6 grams in Europe, where over 55% of the cars produced are diesel; and 2 grams in China, where regulatory requirements are not yet as tight and cars on average are smaller. At present, the 4 gram average in North America is made up of about 3½ grams palladium (substantially up recently from 3 grams), no platinum (down recently from ½ gram) and ½ gram rhodium; the 6 gram average in Europe is split 50/50 between platinum and palladium with ½ gram of rhodium somehow in the mix (a modest recent change from 3 grams platinum, 2½ grams palladium and ½ gram rhodium); and the 2 gram average in China is mostly palladium..."
[I used to feel bad I got some Pd, but no Pt, now I am not sure!]
"...In 2011, about 67% of the palladium supplied to the market was used for catalytic converters – with the supply including about 775,000 ounces from the Russian state palladium inventory. If sales from the Russian inventory are excluded, then approximately 73% of the worldwide primary palladium supply went to catalytic converters."
If true, considering the 1:1 technology, Pd$ ---> 73% of Pt price ($1174 today)!
I expect $200 Pd, within this year! (That's the best I can do according to my prediction record...)
awesome, i bought in at around there last time!
Yes so did I, this time I am merely trying to jinx Pd, relative to my previous jinxed predictions... I really can't say anymore at this stage, possibly I have already counter jinxed it...
After a rest spell, palladium jumps into the lead again. We will probably get to $800 Pd before we get $1800 gold or $40 silver.
So is Palladium riding the Platinum high, or is this also due to mines being shutting down?
Up to about 730 right now for the intraday high.
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This is only temporary! It can drop a few hundred any minute now!
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