Think Platinum Prices are Coming Down?

[first123]

Think again.

http://www.forbes.com/markets/2008/08/06/lonmin-xstrata-platinum-markets-equity-cx_po_0806markets03.html

 

[UCLABelle]

Yep, I didn''t think they were coming down...but I am not in the industry, so I wouldn''t really know.

 

[Adylon]

It''s amazing the big move down in platinum and palladium recently.

It would be a good time for consumers to buy if they want to invest in precious metals coins/bars. As for the mining companies, a lot of them have de-hedged their books and gotten out of long term contracts for lower prices, they''re clearly expecting prices to rise again.

So get it while the gettin'' is good

 

[AndyMN]

I understand that the auto manufacturers are using Palladium in their catalytic converters now. Speaking of platinum and the platinum group metals here''s an intersting excerpt from the annual report of the largest US miner of platinum group metals;
The palladium market continued to see an exchange
of bullion stocks last year, principally fl owing from
Russian government inventories into investors’ hands.
However, notwithstanding this fact and contrary to
the numbers reported above, the palladium market was
almost certainly not in surplus but in defi cit last year,
based upon the calculation of fabrication demand versus
supply from mine production and autocatalyst recycling.
This is of course prior to accounting for the mobilization
of bullion stocks from Russia. Indeed, bullion sales from
Russian government sources comfortably accommodated
this supply defi cit, with the surplus supply being absorbed
by investors whose palladium holdings increased again in
2007. Continued Russian government stock sales largely
explain why palladium prices have advanced relatively
modestly compared to those of the other precious metals
in the past several years. Nevertheless, recent market
reports suggest this might be changing as sales from
Russian inventories are believed to have declined sharply
in 2007.

 

[strmrdr]

It has already dropped and will drop further.
Catalytic converters are moving to other materials.
The slowdown is getting government approval on them.
That will dump a ton of plat on the market.
There are 5-6 different designs in the pipeline for approval none of which use plat.

The current price is still speculation driven and priced it out of the market.
US production is ramping up as long as prices don''t drop to far on gold it will continue.
There is tons and tons of gold and plat out west but 350 an once for gold didn''t support removing it from the ground and or separating it from the mine trailings.

 

[Adylon]

Auto catalytic uses are dropping, however I think it will rebound eventually. Fuel cells and other high tech hydrogen storage devices as well as other specialized uses will be heavily dependent on Pt/Pd. I wouldn''t want to be short Pt/Pd in the long run. But I agree, I think prices will drop more before they move up again.

Just my 2 grams

 

[strmrdr]

Date: 8/6/2008 6:53:55 PM
Author: Yosef
Auto catalytic uses are dropping, however I think it will rebound eventually. Fuel cells and other high tech hydrogen storage devices as well as other specialized uses will be heavily dependent on Pt/Pd. I wouldn''t want to be short Pt/Pd in the long run. But I agree, I think prices will drop more before they move up again.


Just my 2 grams

production fuel cells are likely to use carbon nano-tubes as it has higher efficiency than metal based cells.
I do think they are going to bounce up and down for a while but I think the long term the higher prices aren''t maintainable.

 

[first123]

Those are all very good arguments. I have to agree with Yosef in that, I would not have the "rocks" to short platinum right now. Even though growth in China has slowed it is inevitable that other countries around the world will start consuming resources as they did. And from an economic standpoint, Xstrata did their homework I''m sure and did decide to buy a platinum mining company for no reason. Either way I think platinum, gold and diamond price trends deserve more discussion on this forum.

Thanks all.