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    The document summarizes views on platinum and palladium supply, demand, and prices from 2005 to 2008. It finds that platinum demand from jewelry will likely continue falling in 2005 due to high prices and competition from other metals. Palladium jewelry demand is increasing, especially in China. Autocatalyst demand for both metals will be driven by vehicle production and emissions standards. While platinum surplus is expected in 2005, balancing in 2006, a palladium surplus is forecast to persist through 2005 but contract in 2006. Increased platinum and palladium supply from 2004 to 2008 could outweigh demand growth.

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    The document summarizes views on platinum and palladium supply, demand, and prices from 2005 to 2008. It finds that platinum demand from jewelry will likely continue falling in 2005 due to high prices and competition from other metals. Palladium jewelry demand is increasing, especially in China. Autocatalyst demand for both metals will be driven by vehicle production and emissions standards. While platinum surplus is expected in 2005, balancing in 2006, a palladium surplus is forecast to persist through 2005 but contract in 2006. Increased platinum and palladium supply from 2004 to 2008 could outweigh demand growth.

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    29 views3 pages

    Platinum Palladium Current Views

    Uploaded by

    sobel0722
    The document summarizes views on platinum and palladium supply, demand, and prices from 2005 to 2008. It finds that platinum demand from jewelry will likely continue falling in 2005 due to high prices and competition from other metals. Palladium jewelry demand is increasing, especially in China. Autocatalyst demand for both metals will be driven by vehicle production and emissions standards. While platinum surplus is expected in 2005, balancing in 2006, a palladium surplus is forecast to persist through 2005 but contract in 2006. Increased platinum and palladium supply from 2004 to 2008 could outweigh demand growth.

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    of 3

    GFMS

    Jewellery Cars

    Platinum & Palladium Current views


    Peter Ryan
    New York, 20 September 2005

    Supply Stocks

    PGM jewellery China


    Proxy: Hong Kong PGM imports
    2.5 $900

    Jewellery
    Platinum demand likely to fall again in 2005
    Further decline in China, ongoing erosion in Japan 2m ozs in 2004; could become 1.75m ozs in 2005

    Platinum price
    2.0 million ozs $600 1.5 1.0 $300 0.5

    Why?
    Expensive for consumers Only marginally profitable for manufacturers Competing alternatives (gold, white gold & palladium)

    Palladium again the beneficiary


    0.0 2005 F 1997 1998 1999 2000 2001 2002 2003 2004 $0

    Palladium jewellery; gaining ground in China 0.7m ozs in 2004; should exceed 1m ozs in 2005

    Platinum

    Palladium

    Platinum US$

    Autocatalyst consumption
    (excluding purchases for inventory)
    9.0 8.0 7.0 million ozs 6.0 5.0 4.0 3.0 2.0 1.0 0.0 1996 1997 1998 1999 2000 2001 2002 2003 2004 Platinum Palladium

    Autocatalyst
    Key drivers of PGM demand
    Emissions legislation Production of catalyst equipped vehicles Penetration of diesel engined vehicles (platinum) Outlook for gasoline engined vehicles (mainly palladium)

    GFMS

    Global light vehicle production


    (autocatalyst equipped million units)
    80 70 60 50 40 30 20 10 0
    1996 1998 2000 2002 2004 2006 2008 2010
    China/India Europe Japan/Korea South America USA/Canada Others

    Global light vehicle production


    Market share: gasoline v. diesel
    100% 80% 60% 40% 20% 0%
    1996 1998 2000 2002 2004 2006 2008 2010
    Source: Global Insights

    Diesel Gasoline

    Source: Global Insights

    Global light vehicle production


    Gasoline & diesel (million units)
    60 50 40 30 20 10 0
    1996 1998 2000 2002 2004 2006 2008 2010
    Source: Global Insights

    Vehicle production outlook supportive of both platinum (diesel) and palladium (gasoline)
    Platinums opportunity
    Gasoline Diesel

    Diesel particulate filters Diesel penetration in North America

    Palladiums opportunity:
    Platinum 32% share of the gasoline market Emerging technology for diesel autocatalysts

    Mine production
    Platinum & palladium (million ozs) ozs)
    8.0 7.0 6.0 5.0 4.0 3.0 2.0 1.0 0.0 1999 2002
    Platinum

    Autocatalyst scrap recycling


    Platinum & palladium (million ozs) ozs)
    1.6 1.4 1.2 1.0 0.8 0.6 0.4 0.2 0.0

    2005 F
    Palladium

    2008 F

    1999

    2002
    Platinum

    2005 F
    Palladium

    2008 F

    GFMS

    Mine production + autocat recycling


    Platinum & palladium (million ozs) ozs)
    9.0 8.0 7.0 6.0 5.0 4.0 3.0 2.0 1.0 0.0 1999 2002
    Platinum

    Outlook
    Platinum: modest surplus in 2005; close to balance
    Surpluses expected to appear from 2006 Increased supply 2004 v 2008 ~ 1.4m ozs Represents 19% of total demand in 2004 Represents almost 40% of 2004 autocatalyst demand

    Palladium: further surplus expected in 2005 (~500k ozs) ozs)


    Surplus should contract in 2006 (post Stillwater sales) Increased supply 2004 v 2008 ~ 1.6m ozs Represents 21% of total demand in 2004 Represents almost 36% of 2004 autocatalyst demand

    2005 F
    Palladium

    2008 F

    Switzerland: net imports


    cumulative change 1987 to 2004
    Platinum
    0 -0.1 -0.2 -0.3 -0.4 -0.5 -0.6 -0.7 -0.8 -0.9 -1 1988 1990 1992 1994 1996 1998 2000 2002 2004 7.0 6.0 5.0 4.0 3.0 2.0 1.0 0.0 -1.0 1988 1990 1992 1994 1996 1998 2000 2002 2004

    Palladium

    Ounces - millions

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