12/08 1:00P Commodities Review: Palladium At All-Time High;Rise Seen
LONDON (Dow Jones)--Spot palladium soared to an all-time high of $907.50 a
troy ounce Friday, buoyed by further speculator and physical buying prompted
by continued fears over Russian exports, dealers and analysts said.
Talk started circulating late Thursday that Russia's 2000 palladium export
quota had already been shipped abroad, leaving the market undersupplied as
Russian export licenses for 2001 have yet to be officially signed.
Russia is the world's largest exporter of palladium, accounting for two
thirds of world supply. The metal is mainly used by the auto industry in
catalytic convertors.
Following long bureaucratic delays over the signing of the 2000 export
licenses, the market is expecting the same in 2001.
"Our short-to-medium-term price target for palladium remains at $1,000 a
(metric) ton," said Frederic Panizzutti, head of strategy and research at
Geneva-based MKS Finance SA.
The market is being driven up by speculator buying, he said, adding that
they had started buying earlier this year in anticipation of further Russian
export problems.
"The market was running on its fundamentals between April and September, but
has become more speculator-driven since," said Panizzutti. "And the (Russian)
problems have only just started."
Friday, Russian metals giant RAO Norilsk Nickel (R.NNK) said it is ready to
supply large volumes of palladium to Japan on a long-term contract basis as of
January 2001.
"By the end of 2000, Almazjuvelierexport (Russian state-run precious metals
trader) will work out the details of the contracts, so that supplies could
begin as of January 2001," Dmitri Zelenin, Norilsk deputy general director,
said in a press statement.
However, such statements were made last year and delays in issuing export
contracts still occurred, said dealers, adding that Norilsk didn't say whether
palladium export quotas for 2000 had definitely run out.
Traders had expected palladium exports to rise toward the end of the year,
in line with the trend of recent years.
PHIL |
