Palladium and platinum keep shining on metals market Gold and silver's troubles haven't hurt all markets
Source: The Spokesman Review
Publication date: 2000-12-07
Arrival time: 2000-12-09
Gold and silver prices may be lagging near 20-year lows, but not all metals news is bearish.
"It's a good day today. Palladium is trading at $850 an ounce," a cheery Mo Lavigne told a crowd of engineers and geologists Wednesday at the Northwest Mining Association's annual meeting.
Lavigne works for North American Palladium, which operates an open pit mine in Ontario, Canada. In the U.S., the Stillwater Mining Co. produces palladium and platinum in south-central Montana.
Prices for both metals have risen sharply in the past three years.
The rare metals are used in jewelry, electronics, fuel cells and catalytic converters in automobiles. Demand for platinum group metals is rising, even as exports from Russia have dropped.
This week, prices for palladium and platinum spiked to $875 and $623 per ounce, respectively.
"Some analysts believe it was speculative buying in anticipation of future (Russian) export problems," said Richard Marshall of the U.S. Forest Service in Missoula.
Russia is the world's largest producer of palladium, accounting for about two-thirds of the international supply. Russia is also the world's second-largest producer of platinum, behind South Africa.
"The lack of good information about what's happening in Russia contributes to the price volatility," Marshall said.
Russia exported lower amounts of both metals over the past two years, due to government delays in issuing export licenses. And some Russian platinum and palladium may be going to Swiss banks as loan collateral, instead of being sold for industrial use, Marshall said.
There are few substitutes for the metals. A growing demand for platinum jewelry in China is also helping drive up prices. So is demand from automobile manufacturers.
"It's driven by a worldwide movement for clean air," said Lavigne, whose company recently signed a contract with an automobile company.
Stillwater Mining also recently signed a 10-year contract to supply platinum and palladium to several large automakers. The company hopes to open a second platinumpalladium mine next year. The site is near Nye, Mont., where Stillwater operates the U.S.'s only primary platinum-palladium mine.
This sidebar appeared with the story:
AT A GLANCE
Russia rules
Russia is the world's largest producer of palladium, accounting for about two-thirds of the international supply. Russia is also the world's second-largest producer of platinum, behind South Africa.
Publication date: 2000-12-07
© 2000, YellowBrix, Inc.
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