The market sees a sharp rise in prices for palladium

Prices for this precious metal, which is widely used in industry, rose by 6% in February this year, and their growth is the third month in a row. Last Friday, palladium was trading at $2,981.9 a troy ounce on the market, according to barrons.com, which said it is the highest level since 1984.
The US Geological Survey estimates that Russia produced 74,000 kilograms of palladium last year, which is nearly 40% of the world's mining production.
Market analysts opine that palladium prices are sensitive to disruptions in production and exports in an environment where supply cannot meet demand for this metal. According to them, its shortage in 2021 was approximately 829,000 troy ounces, which is 13% higher than its shortage a year earlier, which was 728,000 ounces.
The risk for palladium is that it is becoming too expensive for the automotive industry, and the use of the metal in catalysts is forcing a shift to another, more economical metal such as platinum, they argue. “About 25% of palladium can routinely be substituted for platinum in diesel catalytic converters, according to the USGS, with that proportion potentially climbing to as much as 50% in some applications. But Russia is also the world’s second largest producer of platinum,” barrons.com said noting that if the movement of catalysts involving palladium occurs in concert potentially disrupting production and exports combined with soaring demand, then record-highs prices for this metal will become "an obvious historical target".

Vladimir Malakhov, Rough&Polished