Palladium prices soar as Russian exports fall, so keep an eye on your catalytic converter
The Russian invasion of Ukraine, now approaching its second week, continues to have unintended global consequences. From now on, its impact is being felt on the price of raw materials heavily exported by Russia, in particular palladium. The extremely rare metal is crucial in exhaust gas purification catalytic converters, and this week it hit a record price of $3,400.76 an ounce before stabilizing at around $3,000 an ounce on Tuesday. .
Monday’s price surge surpassed the record set last year by more than $400 an ounce. Russia is the biggest supplier of this extremely rare metal worldwide, exporting around 100 tonnes in 2021.
The Norilsk-Talnakh palladium deposits located above the Arctic Circle in Russia, controlled by the eponymous company Norilsk Nickel, account for around 40% of the world’s palladium supply and are the largest known deposits on the planet. Although sanctions were not directly imposed on Norilsk Nickel, restrictions on flights from Russia imposed by many Western countries have severely limited shipping and caused massive supply disruptions.
Palladium itself has been in high demand in recent years as stricter emissions standards require more of the precious metal to be used in modern cars, and as a result, the metal has traded on exchanges for more than equivalent amounts of gold for much of the past. three years. The high value has led to blowouts of theft in previous price spikes, as recycling old converters is a lucrative and easy way to access precious metals such as palladium.
Although there was temporary relief from the record high price reached on Monday, such relief could be very temporary if Russian President Vladimir Putin continues to ban exports of certain materials from Russia. The list of restricted materials has not yet been made public, but if palladium is on it, prices will likely rise as swaths of the world lose access to the single largest supplier.
Have a tip or question for the author? Contact her directly: [email protected]