NEW YORK (Scrap Register): Palladium’s price premium over sister metal platinum at one point widened to more than $500 an ounce, which left Commerzbank predicting eventual substitution toward platinum by the auto industry.
Both metals are used for catalytic converters. Palladium initially continued to soar to unimagined heights yesterday and achieved a new record high of $1,344 per troy ounce, Commerzbank added.
The metal then pulled back on profit-taking. As a result of the steep increase in the palladium price, the price gap to platinum has widened to over $500 per troy ounce for the first time.
“We cannot imagine that demand will remain unscathed for much longer. Sooner or later, we are likely to see substitution effects in favor of platinum in the auto industry,” Commerzbank added.
The most active April platinum contract on the COMEX division of the New York Mercantile Exchange edged up by 0.1% to settle at $826.10 an ounce on Thursday, while March palladium rose $3.80 to $1,273.20 an ounce, with prices stretching streak of session gains to mark a fifth straight record settlement.