Mark Anthony

Mine Deeper to Understand Platinum and Palladium

True North:

Here is the rhodium price chart:
www.kitco.com/charts/r...

You stated that rhodium is only up 48% ytd. Wrong. It's up from $1000 at the beginning of 2009 to now $1800+. That's 80%+ up ytd.

It would seem a bit surprise at first look. There is no rhodium futures market and virtually no investment interest because it is extremely illiquid to sell. More over rhodium is 90% dependent on auto demand, a weak sector. Why the price goes up?

The price goes up because industry users are HOARDING extra ounces for strategic stockpiling. Any extra ounces you can buy now, regardless of your current need, means you do not have to pay 10 times higher price at $18000 per ounce a few years down the road. So it makes perfect economic sense to hoard. Mean while producers do not need to sell all the rhodium product. They can hoard up waiting for much higher price in the future.

The same principle applies to palladium. I don't think industry users are dumb. They understand palladium can not stay this cheap for long. If they have cash, it makes perfect economical sense to buy extra to safe guard against a future price shock.

This is especially important as now the Russian government palladium stockpile has now depleted. The next palladium price shock is all but ensured to occur imminently once that fact becomes widely known.

Three things to buy in palladium:
1. The physical metal.
2. SWC stock.
3. PAL stock.

seekingalpha.com/autho...

I think I must be the most outspoken palladium advocator on the internet. I devoted a lot of time studying the market. Read my articles at above link.