Palladium a hot metal favorite in 2011
First things first: North American Palladium has moved 51% higher over the past thee months. This is just one example of how palladium and platinum miners are substantially outperforming the broader market as sentiment has gone from bullish to “just buy the thing.”
Paladium prices have moved above $800 an ounce this week and LGT Capital Management is forecasting an average price of $888 in 2011, perhaps moving as high as $1,111 an ounce on an intraday basis during the year.
Platinum is in the same rarified space, with LGT seeing an average $1,888 an ounce price during the year. Right now, it’s trading just below $1,800 an ounce. The forecast is nothing but good news for the likes of Platinum Group Metals , which is up over 12% in the past three months. Investors are clearly taking note.
Palladium – much like iron ore, gold, zinc and aluminum – should reap the benefits of a decidedly bullish market in 2011, according to Royal Bank of Scotland analysts, who said recently that commodity prices would move higher during the year, just not with the same speculative frenzy seen over the part 18 months or so.
Palladium is being picked as a 2011 winner because it’s being used increasingly in jewellery and fuel cells; the price of the precious metal has climbed some 400% since the end of 2008 as the whole supply/demand side of the equation comes increasingly into play.