The Dhaka Times Desk The price of palladium metal has increased in the global market. The metal has jumped more than 25 percent in the past two weeks, doubling its value over the past year! Which is more than gold.
According to a published report, one ounce (28.35 grams) of palladium costs 2,500 dollars! With the rate at which prices are rising, there is no chance of the metal going down any time soon. But the question has arisen, what is this palladium metal? What is it used for? Why is the price increasing?
Palladium actually looks shiny white. It mainly belongs to the group of platinum metals. The palladium family of metals also includes ruthenium, osmium, radium and iridium. Most of the world's palladium comes from Russia and South Africa. Palladium metal is a by-product of mining other metals, especially platinum and nickel.
This metal is mainly used commercially to make 'catalytic converters', important parts of cars. This catalytic converter is particularly helpful in reducing the vehicle's pollutant gas emissions. More than 80 percent of the palladium is used in the device, which converts toxic gases carbon monoxide and nitrogen dioxide into less harmful nitrogen, carbon dioxide, and water vapor. Recently, the price of this metal has become so high that theft of catalytic converters from cars is on the rise worldwide.
Meanwhile, London's Metropolitan Police says that the number of thieves caught in the first 6 months of 2019 is more than 70 percent compared to last year!
The price of palladium metal is rising due to supply being less than demand. At the rate of production of this metal in 2019, it is predicted that its supply is many times lower than the world demand for it in the next 8 years.
Rising prices have pushed miners to produce palladium over platinum and nickel. However, it appears that this shortfall may persist. That's because South Africa, which used to produce close to 40 percent last week, said production of the platinum group, which includes palladium, has fallen to 13.5 percent. If you compare November 2019 with November 2018, this amount is very less.
Meanwhile, the demand for palladium from car manufacturing companies has increased significantly. There are many reasons behind this. Governments around the world have strict regulations to reduce air pollution from petrol-powered cars, especially in China.
At the same time, the scandal over diesel emissions from cars in Europe also had a huge impact. As a result, customers turned away from diesel-powered cars, which originally used platinum for catalytic converters. They are currently leaning towards petrol powered cars, where this metal is used in the converter. Earlier this month, the trade agreement between China and the United States also increased the price of palladium, according to media sources.
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