Commerzbank: Supply Deficits To Underpin Prices Of Platinum, Palladium

Wednesday June 15, 2016 08:25

Supply deficits in platinum group metals are likely to continue, thereby supporting prices, says Commerzbank. Analysts project platinum will average $1,000 an ounce in the third quarter, $1,050 in the fourth and $1,100 in the first quarter of 2016. They see palladium at $575 in the third quarter, $625 in the fourth and $650 in the first three months of 2016. “Supply is unlikely to be sufficient to cover demand yet again this year on both the global platinum and palladium markets,” Commerzbank says. “Both markets thus look set to record their fifth consecutive year in deficit, which in our opinion points to higher platinum and palladium prices. There are likely to be some limits to the anticipated price rises, however.” Analysts point out that two widely followed reports – from Johnson Matthey and the World Platinum Investment Council – both call for platinum supply deficits this year. As a result, the WPIC calls for above-ground stocks to fall to 1.95 million ounces, after they were almost 1.5 million higher three years ago. Johnson Matthey also foresees a palladium supply deficit, Commerzbank adds.

By Allen Sykora of Kitco News; asykora@kitco.com