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Lofty Palladium prices may start supporting Platinum

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NEW YORK (Scrap Register): The investment case for buying platinum may be growing as the continued ascent in palladium prices at some point may mean substitution of platinum for some palladium in auto catalysts, said commodities brokerage SP Angel.

Palladium this week topped $1,600 an ounce for the first time ever. In earl morning trade, spot palladium was trading $9 higher to $1,587 an ounce, while platinum was $10 stronger to $871, giving palladium a premium of $716.

This has traders trying to assess when and whether lofty palladium prices will start driving demand for platinum in emissions-controlling devices, SP Angel added.

Analysts note that platinum 30-day volatility has jumped to the highest level since September, with platinum prices gaining around 7% for the year so far.

“The investment case for owning platinum is growing as substitution risk for palladium rises, with the current price differential creating a very compelling case for using more platinum in catalytic converters,” SP Angel concluded.

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