Bloomberg has just released news regarding restrictions that will effect South African mines production of palladium for 2010. Ian Henderson of JP Morgan Chase predicts the rise of both platinum and palladium due to the government depriving two key mines in South Africa of mining rights. Chanyapor Chanjaroen reported, full article here;
Similar political upheaval in Russia during 2001 caused palladium to skyrocket over $1000 an ounce. Will it happen again? Time will tell.
China needs the metal for all the cars their booming middle class wants. The US needs the metal for all their new projects in the hydrogen energy field. India has a heavy interest as well. Due to mining accidents that killed miners in West Virginia, US mines must adhere to strict regulations now being enforced in the US. This has caused Stillwater Mines, the only US Palladium producer, to reduce forecasted production of the precious metal. All things point to a real supply and demand imbalance. Palladium may very well be at half the price of platinum, as many have said in the near future.
We’ll keep you posted.