Palladium Stocks Alert: Why Are SBSW, IVPAF, ANGPY, PLG Stocks in Focus Today?

Palladium prices hit a seven-month high today despite a number of palladium stocks trending down. Some suspect the sanctions levied against Russia, a top palladium producer, is behind the recent jump.

The periodic table shows element 46, Palladium.
Source: Shutterstock

So, what do you need to know about palladium today?

Well, today the price of palladium rose more than 3% to $2,754 per troy ounce. This is the highest level for the metal since August of last year. Palladium is a precious metal frequently used in the production of catalytic converters in cars.

Russia has historically been one of, if not the absolute, largest producers of palladium. Last year Russia produced roughly 74,000 kilograms of palladium. This represents about 40% of the world’s palladium production in 2021, second only to South Africa.

Many suspect the conflict in Ukraine and subsequent sanctions against Russia may only continue to put inflationary pressure on palladium, potentially to record highs. Shaun Murison, senior market analyst at IG commented on the situation:

“Palladium prices remain sensitive to the situation and the disruption to production and exports. … Palladium has been in deficit long before the Russia-Ukraine situation reached crisis level. … [It is] becoming too costly for the automotive industry, and the metal’s use in catalytic converters forces change to another more cost-effective metal such as platinum.”

What else do you need to know about palladium today?

Palladium Stocks See Little Gain From Price Jump

Despite palladium reaching a seven-month high, palladium companies are down across the board today. Indeed, Sibanye Stillwater (NYSE:SBSW), Ivanhoe Mines (OTCMKTS:IVPAF), Anglo American Platinum (OTCMKTS:ANGPY) and Platinum Group Metals (NYSE:PLG) are each down today less than 3%.

Between 25% and 50% of palladium can be substituted for platinum in catalytic converters. However, Russia remains the second-largest producer of platinum as well. The required supply of palladium required for the production of cars continues to grow year after year. Growing demand combined with substantial supply disruptions could easily lift the metal to record levels.

Metals are in flux lately and may continue to be volatile as the situation in Europe remains uncertain.

On the date of publication, Shrey Dua did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the Publishing Guidelines.

With degrees in economics and journalism, Shrey Dua leverages his ample experience in media and reporting to contribute well-informed articles covering everything from financial regulation and the electric vehicle industry to the housing market and monetary policy. Shrey’s articles have featured in the likes of Morning Brew, Real Clear Markets, the Downline Podcast, and more.

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