CHINA March 23 2016 10:38 AM

LONDON (Scrap Register): China has doubled its January platinum group metals imports mainly due to lower prices combined with good industrial demand.

According to HSBC, the Chinese data showing that the country imported 10.1 tons of platinum in January, almost twice as much as in the same month a year ago. 

“It is very likely that the skid lower in prices when platinum dropped to near $800/oz, revisiting 2008 lows, galvanized demand for platinum,” HSBC added.

Palladium imports reached 2.6 tons in January, an almost 90% increase year-on-year and a near 150% increase from December. Prices for a while were below $500 an ounce. 

“In the case of both PGMs, industrial users, notable auto makers, seemed to take advantage of the drop to rebuild local inventories,” the bank added. 

“The positive views from HSBC macroeconomic, auto, chemical and glass research imply that demand for the PGMs in China is likely to be moderately good this year. This leads us to view the gains in imports as not solely due to lower prices,” the metals analysts added.

Although China’s auto sales and production volume edged slightly lower, the implementation of China V emissions regulations is in full swing, HSBC continues. 

“The regulations tighten the NOx and particulate matter emissions and require heavier palladium loadings. This should support demand,” the bank added.