Market Report

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Heraeus Precious Appraisal

Palladium: too important to be sanctioned?

No. 40 | 04th November2024

Sanctions on Russian palladium would be very disruptive to US and European businesses and that is most likely the reason that sanctions have not already been imposed. The suggestion of putting sanctions on Russian palladium was apparently raised at the G7 meeting. This resulted in the palladium price jumping by more than $100/oz to over $1,200/oz, its highest level in a year.

The US needs to import palladium. The US used 2.0 moz of palladium in 2023. The majority was for autocatalysts (88%) as gasoline light vehicles dominate demand even with BEVs gaining market share. The remainder was for various industrial applications. Mine production in 2023 was relatively modest at 330 koz, but even though the US is the largest region for autocatalyst recycling, total domestic supply falls short of demand. In fact, the situation is more complicated with the US importing and exporting significant quantities of palladium metal and material for recycling.

Europe is in a similar situation, with negligible mine production and quite large secondary supply from recycling autocatalysts and WEEE. However, supply still falls short of demand and the region needs to import palladium so automakers can meet emissions standards for combustion engine vehicles.

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