Palladium price

Palladium is unusual among precious metals: it is an industrial metal that also trades as an investment product. About 80% of demand comes from automotive catalytic converters. In three-way catalysts for petrol internal combustion engines, palladium helps neutralise carbon monoxide, hydrocarbons and nitrogen oxides. The price therefore tracks global car-production cycles, including sales in China, Europe and North America, and tighter emissions rules such as Euro 7 and China 7.

Supply is highly concentrated by geography, which is another defining feature of the market. Russia accounts for almost 40% of global mine output, which is about 210 tonnes a year, mainly from Norilsk Nickel’s deposits on the Taimyr Peninsula, at about 85 tonnes. South Africa supplies a further roughly 35%, through producers such as Sibanye-Stillwater, Anglo American Platinum and Impala Platinum, at about 75 tonnes. Russian export restrictions, South African mining strikes and power shortages linked to Eskom load-shedding can feed directly into prices. Canada, the US and Zimbabwe produce most of the rest.

The third factor is substitution and recycling. The price ratio between palladium and platinum influences which metal catalyst makers prefer. In an earlier market cycle, a sustained premium for palladium encouraged a shift back towards platinum in petrol-engine catalysts. Recycled palladium, mainly from spent catalytic converters and known as secondary supply, adds 70–90 tonnes a year to mine production and can act as a stabilising force after price spikes.