Metals Page Palladium showing a lot more promise

The most important of these sister metals to platinum is palladium. It is a stirring name, meaning “safeguard of liberty” in ancient Greece. Some call it “the poor man’s platinum” because it is so much cheaper. Palladius, incidentally, was the bishop sent by Rome to Irish Christians in AD 431, well before Patrick’s arrival.

This metal’s performance qualities are remarkably similar to more expensive gold’s and therefore there has long been an expectation palladium could be widely substituted for it. However, the principal inroads it has made in recent years have actually been mainly at the expense of rhodium, which has for a long time remained the world’s most costly precious metal at about $1,200(US) per troy oz (that is, almost $39 million per tonne).

If platinum is too rich for your blood, consider palladium, the second cheapest of these metals. One easy way to purchase palladium is in coin form. From 1987, palladium coins have been available from France and Bermuda. They make a valuable gift to your children or grandchildren for their deposit box. Medallions in palladium are also marketed. Prospects for growth

Why should one consider buying palladium? Well, the best prospect for future growth among the platinum group metals is palladium. Some experts now calculate palladium will partly replace much more expensive rhodium and/or platinum in certain automobile exhaust catalytic converters. The recent announcement by automaker Ford (that it is developing a catalytic converter which does not use platinum in its fabrication) does not name palladium.

Auto converters are already palladium’s third largest use, ranking after the booming electrical and electronic applications (more than one-third of total consumption and now 60% higher than in 1983) and dentistry. Converters could conceivably become its largest or second largest use.

If this use in converters develops in volume, the brakes are off the price, which is currently around $140 per oz. (Platinum has been selling in the $530 range.) A price of between $200 and $300 for platinum in a few years becomes quite possible in that case. Experiments have taken place using palladium with a rare earth metal.

Asia (42 tonnes per year), mainly Japan, is easily the world’s largest consumer of palladium, followed by the United States (30 tonnes) and western Europe (24 tonnes). Consumption to rise

The 3-way platinum-rhodium- palladium converter is the current favorite of the European car makers. However, ignoring the possible technological breakthrough mentioned, annual consumption of palladium in Europe should reach 26 tonnes next year and 30 tonnes by 1995, as more countries enforce mandatory automobile exhaust emission standards.

In 1988, Japan should consume about 50% more palladium than Canada and the U.S. combined.

Canada consumes about two tons of palladium per year, against a mine (byproduct) output of some 5.5 tonnes. Total non-communist world mine production of palladium is only about 42 tonnes per year. (The balance of free world total consumption of more than 100 tonnes annually comes from secondary and Soviet sources.) Strong world consumer demand continues.

Palladium is used in nuclear reactors as a brazing alloy, in the Saturn liquid hydrogen rocket space engine, gas turbine jet engines, in petroleum refining, as electrical contacts in many telephone systems, as one form of white gold for jewelry, in dentistry, in making antibiotics and other pharmaceuticals, in surgery for load-bearing devices in replacements of damaged or arthritic joints and bones, and so on.

On balance, the evidence currently available points mainly upwards for the price, which is good news for miners and those who invest. T. P. (Tom) Mohide, a former president of the Winnipeg Commodity Exchange, served as a director of mining resources with the Ontario Ministry of Natural Resources prior to his retirement in 1986. Next month’s column will cover the other platinum group metals: rhodium, iridium, ruthenium and osmium.

]]>