Platinum Outlook Remains Volatile

Discussion in 'Platinum' started by finicky, Jun 26, 2012.

  1. finicky

    finicky Well-Known Member Silver Stacker

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    Not much to get excited about here; but again comments about Rhodium have caught my interest. Maybe someone should find out a route to get a group buy going when the price gets even lower? Someone else I mean, not me. Love that little Baird and Co number.

    "TGR: We've talked about platinum and palladium, but we haven't talked about rhodium. There's been quite a bit of price volatility in rhodium over the last year. Is that a good play for investors right now?

    ER: Poor rhodium. It's less than half the price that it was the beginning of 2011 because of deterioration in demand. A couple of years back, rhodium reached $10,000/oz. When that happened, users were saying, "We've got to stop using rhodium!" There was a lot of thrifting. For instance, there have been some technological advances in the auto industry that have helped reduce rhodium use for auto catalysts. Rhodium is competing with that technology.

    There's also been an interesting trend development in rhodium supply. Rhodium supply in South Africa has grown at a much faster pace relative to platinum/palladium in the past 20 years. A lot of that is because of new developments in the processing of the metal and greater recovery rates of rhodium. There have been larger surpluses of rhodium in the past decade. That coupled with aggressive developments toward substituting and thrifting in auto catalysts and other catalytic applications is bearish for rhodium. Rhodium is a good medium- to long-term play, but I expect some further declines in the price in the short term."

    http://www.kitco.com/ind/GoldReport/20120625.html

    http://www.kitco.com/rhodium/

    [​IMG]
     
  2. goldpelican

    goldpelican Administrator Staff Member

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    It's cheap today :/

    Pt that is, not Rhodium.
     
  3. Lunardragon

    Lunardragon Well-Known Member Silver Stacker

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    why fractional platinum coins are not available to bullion dealers?
    are they not as attractive as the fractional gold coins?
     
  4. Big A.D.

    Big A.D. Well-Known Member Silver Stacker

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    If you ask a dealer, they'll say they don't stock fractional platinum because nobody buys it.

    If you point out that nobody can buy it if dealers don't sell it, they'll say yes, we don't sell it because nobody buys it.

    If you then suggest that perhaps more people would buy platinum if the minimum investment was less than $1500-$1600 they will tell you than nobody buys platinum so it doesn't matter either way.
     
  5. goldpelican

    goldpelican Administrator Staff Member

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    Not aware of many readily available in the market - American Platinum Eagles are still struck in fractional sizes I believe, haven't looked much into others.

    The Perth Mint currently has no plans for fractional platinum bullion announced.
     
  6. boyracer

    boyracer Member

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    Thanks I was wondering the same thing but that answer makes sense. I think :/
     
  7. Captain Kookaburra

    Captain Kookaburra Well-Known Member Silver Stacker

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    These will all of course be subject to GST on importation. :(
     
  8. goldpelican

    goldpelican Administrator Staff Member

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    I think the Rh coins and bars are pressed from sponge, and are quite brittle, but that's the nature of the metal.

    Brittle as in put them in a vice and hit them with a hammer and they will snap, not as in drop it and it smashes into pieces.
     
  9. finicky

    finicky Well-Known Member Silver Stacker

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  10. STC

    STC Well-Known Member Silver Stacker

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    Where do I sell my rhodium bullion if it goes back to $10000/oz?
     
  11. Big A.D.

    Big A.D. Well-Known Member Silver Stacker

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    There are fractional platinum products out there (including the Platinum Eagles) but nobody has really bothered trying to market them.

    The Perth Mint is a classic example of this circular reasoning: a couple of years back some of us queried why they didn't have any platinum products (despite quoting the platinum and palladium spot prices).

    The answer was that there was no demand.

    We asked how they estimated demand.

    They said sales of Platinum Koalas had dropped off after 1997.

    We said "Um, that was more than a decade ago. Don't you think the bullion market may have changed a little bit over that period?"

    They released the 1oz Platypus in 2011 and the 30,000 mintage sold out.

    The mintage for 2012 is 30,000 and they've got a privy mark Platinumpus authorised as backup in case they sell out of the standard issue.

    Obviously the market for platinum is smaller than the market for gold is and the price of platinum has been hammered lately and demand has dropped (then again, so has silver and the Perth Mint has published production data for silver that shows how much of it they haven't been selling compared to 12 months ago), but again, it goes back to there being very little supply available which obviously affects how much demand there is.

    If you don't have any platinum for sale, nobody is going to buy platinum from you.
     
  12. goldpelican

    goldpelican Administrator Staff Member

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    I recently suggested that the Perth Mint consider introducing platinum in Certicards.
     
  13. Roswell Crash Survivor

    Roswell Crash Survivor Well-Known Member Silver Stacker

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    Exactly why nobody would ever try to mint a Rhodium bar or coin.
     
  14. hiho

    hiho Active Member Silver Stacker

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    Rhodium has a higher melting point and lower density than platinum. It has a high reflectance and is hard and durable.
     
  15. finicky

    finicky Well-Known Member Silver Stacker

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    You know, just rereading Azure's post those Cohen Mint coins and bars still look doable, even taking into account the GST. At a rate of $1410 + GST of $141 = $1551, you still only have an amount close to the price of spot gold. There are other costs of course - the shipping and the secondary Oz dealer's margin to add, but that would probably not add up to a prohibitive price at all.

    [​IMG]
    Source: http://www.rhodiumcoin.com/index.html

    Then there are those Baird & Co little numbers to consider.

    Also, it sounds like a fair chance that Rhodium will get even cheaper before it possibly begins a slow trend higher for long term investors.

    It's still an element that apparently is rarer in the earth by at least one order of magnitude than gold and platinum according to this page that is linked. Reportedly there are the other factors that have affected both supply and demand lately in Rhodium's disfavour, but you would think that inventories and mining reserves of Rh would have to be very small compared to platinum, let alone gold. I mean, it might not be much in fashion lately, but it's really rare.

    By the way, with this interactive page linked, you get a result that says gold is rarer, by one order of magnitude, than platinum. There seems to be a disagreement about the relative rarity of the two

    http://www.periodictable.com/Properties/A/CrustAbundance.html
     

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