MOSCOW, Feb 26 (PRIME) -- Russian metals giant Norilsk Nickel expects an 800,000 ounce palladium deficit in 2019, as demand will outstrip supply, the company said in a statement Tuesday.
The price of palladium has been hitting historic highs recently due to low supply and high demand from auto producers that strive to meet strict environmental norms.
This year palladium is becoming a preferable metal in the production of gasoline autocatalysts, as its complete replacement with platinum is impossible due to technical difficulties, Norilsk Nickel said.
“Despite a slowdown in auto sales in China, introduction of China 6 standard in July 2020 will give an additional impetus to demand for platinum group metals already in 2019, as the industry will begin to make stocks throughout the value chain. In addition, transition to testing cars in conditions of real driving and simultaneous hybridization of passenger vehicles will further tighten the requirements for automobile exhaust and, correspondingly, increase the demand for palladium,” the statement said.
Norilsk Nickel projects that palladium consumption will grow by 500,000 ounces to 11.2 million ounces in 2019, while primary supply will increase by 280,000 ounces to 7.1 million ounces. Secondary production will grow by 80,000 ounces to 3.3 million ounces.
“The growth of supply will be lower than demand, that’s why we expect a structural deficit to continue on the market in the amount of 800,000 ounces,” Norilsk Nickel said.
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