Why Palladium Prices Have Skyrocketed

In the spring of 2022, the Russian invasion of Ukraine caused palladium to become incredibly valuable. Part of the reason is that Russia is one of the main sources of this precious metal. At the time, the price of palladium soared to over $3,000 an ounce. Below, the precious metals experts from First National Bullion, the palladium, platinum, silver, and gold dealers Scottsdale collectors rely on for outstanding quality and service, take a closer look at palladium and why it’s become so valuable in recent years.

Uses for Palladium

Palladium is a silver-white metal that’s 30 times rarer than gold. It’s widely used in the automotive industry to make catalytic converters for gasoline-powered vehicles. The auto industry accounts for approximately 85 percent of palladium use. In addition to being sold as coins and bars, palladium is also used to make electronic components, dental fixtures, and jewelry.

Restrictions

Russia provides about 25 percent of the world’s palladium supply. The previous administration restricted imports of several items from Russia to the United States, including palladium. Many other nations joined in on these sanctions..

South Africa, Canada, Zimbabwe, and the other major producers of palladium simply cannot fill the gap left by what has been lost with the restrictions on Russian palladium. South Africa, in particular, has issues with recurring labor strikes that further hinder production.

Increased Demand & Limited Supply

There has been more demand for palladium in recent years, which could explain why this precious metal is so valuable these days. Palladium is already in limited supply. Demand has outpaced supply for three years now, and 2024 could be the fourth year in a row for this trend, according to analysis based on last year’s production and demand figures. 

More Demand from China

According to various reports, China is using more palladium than ever before. Every now and then the country steps up use and demand to stimulate its economy. China currently accounts for 30 to 35 percent of global palladium demand, which has declined, although it still exceeds supply.

Choosing Your Palladium

Invest wisely with palladium. Finding good deals on palladium is still possible, especially if you buy physical palladium. Investing in palladium mines is a bit risky, since there are, as discussed above, challenges such as labor strikes and production issues. With physical palladium, you can hold on to your palladium until it’s a good time to sell and make a nice profit if you sell at the right time. You can diversify your portfolio with palladium through physical holdings, securely stored at home or in one of our trusted First National Depositories.

Whether they’re veteran palladium collectors or new investors looking to buy silver bars, Scottsdale residents should reach out to the experts at First National Bullion. We offer a huge selection of palladium, gold, platinum, and silver items. Scottsdale collectors who are looking for the finest-quality coins, bars, and bullion should give us a call to speak with one of our precious metals experts. 

The statements made in this blog are opinions, and past performance is not indicative of future returns. Precious metals, like all investments, carry risk. Precious metals and coins may appreciate, depreciate, or stay the same in cash value depending on a variety of factors. First National Bullion does not guarantee, and its website and employees make no representation, that any metals for sale will appreciate sufficiently to earn the customers a profit. The decision to buy, sell, or borrow precious metals and which precious metals to purchase, borrow, or sell are made at the customer’s sole discretion.