Engineering and Mining Journal - Whether the market is copper, gold, nickel, iron ore, lead/zinc, PGM, diamonds or other commodities, E&MJ takes the lead in projecting trends, following development and reporting on the most efficient operating pr
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80 E&MJ; • OCTOBER 2017 www.e-mj.com MARKETS With the exception of lead and zinc, which posted month-on-month gains of $146 per metric ton (mt) and $77.50/ mt, respectively, most metals gave up some of the August gains in September. The big metal pricing story among trad- ers during September was the historical- ly signifi cant event of palladium overtak- ing platinum. At the end of September, palladium closed at $936 per ounce (oz), compared to $922/oz for platinum, according to Johnson Matthey. Traditionally, platinum has traded at a premium to palladium, but the trend has shifted over the last three years. In 2015, platinum was trading at more than a 50% premium to palladium. Palladi- um has gained ground over that period while the value for platinum has dropped steadily. Last month, both metals lost value, but palladium lost less value than platinum. Month-on-month, according to the E&MJ; Price Index, platinum dropped $68/oz, while the price for palladium only decreased $4/oz. Both of these platinum group metals (PGMs) have signifi cant exposure to the automotive industry for their use in cat- alytic converters. Over time, more diesel engines have been replaced by gasoline engines and hybrid systems, which use more palladium. The catalytic converters for diesel engines rely on platinum. The twist, however, with this market is that palladium mine supply is mostly a byproduct of South African platinum mines. If platinum mine supply is grow- ing so is the palladium mine supply. There is also a secondary supply of pal- ladium feeding the market. PGM market bears are warning that the prices for these metals, which they say often get ahead of fundamentals, could decline further. They also believe the drop could be sharp as specula- tive buyers exit the market. Let's hope they're wrong as this could be more un- welcome news for a group of mines that have seen the price for platinum decline steadily since 2011. Palladium Overtakes Platinum By Steve Fiscor, Editor Gold and silver prices provided by KITCO Bullion dealers (www.kitco.com). Platinum group metals prices provided by Johnson Matthey (www.platinum.matthey.com). Non-ferrous base and minor metal prices provided by London Metal Exchange (www.lme.co.uk). Iron ore prices provided by Platts Iron Ore Index. Currency exchange rates were provided by www.xe.com. (September 29, 2017) Precious Metals ($/oz) Base Metals ($/mt) Minor Metals ($/mt) Exchange Rates (U.S.$ Equivalent) Gold $1,279.40 Aluminum $2,110.50 Molybdenum $16,000 Euro (€) 1.171 Silver $16.63 Copper $6,485.00 Cobalt $59,000 U.K. (£) 1.324 Platinum $922.00 Lead $2,519.00 Canada ($) 0.798 Palladium $936.00 Nickel $10,585.00 Iron Ore ($/dmt) Australia ($) 0.781 Rhodium $1,185.00 Tin $20,995.00 Fe CFR China $69.77 South Africa (Rand) 0.073 Ruthenium $70.00 Zinc $3,217.00 China (¥) 0.150