London LPPM suspends Russian Palladium and Platinum

derryb

And naturally, prices soar.

"Prices of palladium surged as much as 11%, with traders fearing the move could worsen a shortage of the metal automakers use in exhaust pipes to reduce emissions. Just how reliant is the world on Russian metals? Russia's Norilsk Nickel produces 25-30% of the world's palladium supply and about 10% of platinum, which is also used to curb vehicle emissions as well as in other industries and to make jewellery."

One could wonder it sanctions are a catalyst for an economic reset. Why else would the US purposely take part in destroying its own currency? Was Pandemic control the first step? Unfortunately, any 'great reset' will require the elimination of the protection offered by gold and silver. Let first steps elsewhere be your warning.

RobM

Do you think there will be a longer term impact to palladium prices? Or, will there just be a readjustment in the flow of the metal's trade? If Russia produces 30 or 40% of the world's palladium why wouldn't they just ship all their Pd to China and other countries that aren't sanctioning them? Ironically, a major reason that auto manufactures switched from Pt to Pd a couple decades ago was to avoid the geopolitical concerns related to SA mine interruptions as the world's dominant producer of Pt.

derryb

@RobM said:
Do you think there will be a longer term impact to palladium prices?

yes, prices in the West will continue to rise as available supply decreases.

Or, will there just be a readjustment in the flow of the metal's trade? If Russia produces 30 or 40% of the world's palladium why wouldn't they just ship all their Pd to China and other countries that aren't sanctioning them?

It's not a question of what will Russia do with its metal that does not reach the West. It's a matter of what affect this has on prices the West pays based on available supply.

Ironically, a major reason that auto manufactures switched from Pt to Pd a couple decades ago was to avoid the geopolitical concerns related to SA mine interruptions as the world's dominant producer of Pt.

Most of the reason was cost, which is driven by geopolitical actions. But yes, risk assessment dictated a change.

RobM

China, India, and Russia build nearly half the world's light autos. The US and Canada each mine significant amounts of Pd and are net exporters. Is it possible that Pd gets priced differently in different markets? It would really come down to where South Africa and Zimbabwe align. If they readily supply Europe, Japan, and South Korea, then the supply issues will reside with China. If they are willing trade partners with China, then Europe, Japan, and South Korea may be where Pd supply issues manifest. Who knows, but glad that I have some exposure to Pd.