5 oz Rhodium Baird & Co. Bar
Like its sister metals, rhodium’s main application is to clean vehicle emissions, the world’s manufacturers of auto catalysts, on Wednesday hit $1,650 an ounce, a six year high.
Due to rarity, the small size of the market and concentrated supply – South Africa alone produces roughly 80% of the world’s rhodium – prices are typically volatile.
Rhodium stands out when it comes to price swings – rhodium touched $10,025 an ounce just before the 2008 financial crisis hit, but would drop 90% before the end of that tumultuous year.
“The South African producers bled their stocks dry to achieve a balance (in the market) last year”.
Rhodium and palladium finds application in gasoline vehicles while diesel-powered mostly use platinum for auto catalysts. Platinum at $925 an ounce is trading flat in 2017, while palladium has surged more than 40%, breaching $1,000 last week for the first time since 2001.
Most of the recent buying of rhodium has come from the automotive sector, but companies in other industrial sectors were also picking up metal.
Rhodium is also alloyed with platinum to make reinforcement fiber for the high-tech glass on consumer electronics, and used as a catalyst to make certain chemicals.
Rhodium has also benefitted from speculative demand. Deutsche Bank launched a rhodium exchange traded fund as far back as 2011 while South Africa’s Standard Bank listed its own physically-backed rhodium ETF at the end of 2015.
South African PGM producers extract a mix of metals comprising roughly 60% platinum, 30% palladium and 10% rhodium.
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