Palladium Price Outlook
"Palladium Price Outlook
Palladium prices have been moving sideways with a slight upward bias over the past month. Seasonal strength in prices, a recovery in demand from the Chinese market, and the mine supply disruptions in the United States and South Africa have all been factors that are supportive of prices. That said, some loss in palladium demand to substitution of the metal with platinum in autocatalysts coupled with somewhat weak demand in most auto markets outside of China is preventing palladium from rising more sharply.
Palladium prices are expected to move between $1,950 and $2,500 over the next few months.
Fiscal stimulus being provided by the Chinese government to Chinese auto buyers to boost Chinese economic growth from the weakness that was experienced due to covid related shutdowns earlier this year has been helping to increase passenger vehicle sales in the country over the past few months. While this is supportive of palladium fabrication demand the degree to which it is positive is reduced by the fact that this stimulus is geared more toward the purchase of smaller or electric vehicles. Holding all factors that influence the amount of palladium loaded in autocatalysts constant, the smaller the vehicle the lesser the platinum group metals loadings. Furthermore, pure electric vehicles require no palladium.
Auto demand is Western markets has been lackluster with high interest rates and an ongoing shortage of vehicle inventory weighing on auto demand.”