High prices for platinum group metals (PGMs) will continue in the short term, according to Platinum Group Metals Survey 2000, published by New York, N.Y.-based CPM Group.
The survey, which summarizes data and indentifies emerging trends, points out that markets for platinum, palladium and rhodium have undergone major shifts in recent years. The markets operated in a surplus for most of the early 1990s, but recently all three have experienced deficits. As a result, prices, especially for palladium and rhodium, have soared.
The survey predicts an uncertain future for all three metals. Issues such as Russian exports, price volatility, supply concerns and the expanding worldwide demand for PGMs will influence future market trends.
Platinum prices averaged US$373 per oz. in 1999, up only slightly from 1998. However, in the first five months of 2000, prices skyrocketed, averaging US$474.87 per oz., or 27% higher than in 1999.
The platinum supply is projected to rise 10% this year to 5.2 million oz., reflecting a 4.2-million-oz. increase in mine production and about 200,000 oz. in Russian exports. The platinum market will remain in a deficit this year, though the shortfall will shrink to 94,000 oz. in 2000 from 440,000 oz. in 1999.
Industrial demand is expected to increase 2.5% to 5,272,000 oz., owing to a sharp rise in auto use. Prices averaged US$585.06 per oz. in the first five months of 2000, up 71% from the corresponding period in 1999.
Total palladium supply could rise 4.5% to 5,877,00 oz. in 2000. Russian exports are expected to rise to 1.8 million oz., while mine production could expand to 2.7 million oz. The net deficit in the palladium market should contract to 865,000 oz., down from 1.3 million oz. in 1999.
Rhodium prices in the first five months of 2000 averaged US$1,621 per oz., up 97% from the corresponding period in 1999.
Total rhodium supply is forecast to rise 6.8% to 527,887 oz. in 2000, while industrial demand could absorb 536,161 oz., up 3.3% from last year. Meanwhile, an overall deficit of 8,274 oz. is projected for 2000, compared with 24,844 oz. in 1999.
Copies of the survey can be obtained for US$80 by contacting the CPM Group, 30 Broad St., 37th Floor, New York , N.Y., U.S. 10004.
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