Platinum price decline: to invest now or not?

slavaja said:
Does anyone still think Platinum is a buy atm or wait till everything goes to crap first.
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I think it depends on your portfolio as platinum is risky and if your portfolio is mostly bonds, cash and gold like me, dollar cost averaging a little platinum won't hurt.

I first bought platinum a year ago, a couple of QB griffins and dragons for about $900 a coin. On hindsight, it was very cheap and no brainer but at that time no one is interested in platinum as an investment. I bought them as I liked QB coins and I find the Platinum griffin very pretty. Subsequently, after gold spiked in July 2020, platinum followed in late August. I increased my platinum stack, basically DCA upwards as the price rose.
 
I seriously researched buying pt the week before last. There is so little use of it outside of labs. I put it in the same category of ag, both in massive glut.
 
pennys said:
I seriously researched buying pt the week before last. There is so little use of it outside of labs. I put it in the same category of ag, both in massive glut.
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Just like ag, pt is a byproduct, for the case of pt, a byproduct of pd and rh. Pd and pt are mined together at almost the same ratio in South Africa. If you could imagine every ounce mined in South Africa, 1/2 ounce is pd that now fetches $2600/oz. some of it is rh. South African mines are now insanely profitable.
 
sgbuyer said:
South African mines are now insanely profitable.
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Insanely corrupt. Government corruption and withholding electricity is a major factor for high price. But its being used in applications where it can be easily recycled. Seems to me like there is more going on with pd than meets the eye. I didn't understand it so I stayed away.
 
pennys said:
Seems to me like there is more going on with pd than meets the eye. I didn't understand it so I stayed away.
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I think pd is a physical markets. You can’t short sell pd if there aren’t any pd to buy back. :D

If I were a car manufacturer, I’ll be stocking up as much pd as possible even at the current high price before the bug gets to South Africa.
 
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sgbuyer said:
If I were a car manufacturer, I’ll be stocking up as much pd as possible even at the current high price before the bug gets to South Africa.
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Just a hunch that Pd demand is coming from something other than cars and electronics. It's not a very transparent market. May be I'm completely wrong.
 
pennys said:
Just a hunch that Pd demand is coming from something other than cars and electronics. It's not a very transparent market. May be I'm completely wrong.
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Previously, I did consider that the Chinese are buying it for smuggling wealth out of China. It's easier to smuggle kilobars of Pd out of China than gold bars. But Pd didn't even stop rising with the CNY and then virus shutdowns so the demand is not just from China.

It may really be a supply shortage situation and the market has gone physical where short selling is no longer possible. If you can't short, the price will just continue to rise as long as there is demand for it in fabrication of autocatalysts. Of course, I maybe wrong.

Another thing which I've concluded is it may not be so easy to switch to platinum for autocat. Eventually, what may cause the switch is a total break in supply of pd from South Africa which could cause governments to change the emission rules to allow for platinum. Although there's no indication that this will happen but we've seen in China that rules can be changed overnight if they want, without any advance warning.
 
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sgbuyer said:
Another thing which I've concluded is it may not be so easy to switch to platinum for autocat. Eventually, what may cause the switch is a total break in supply of pd from South Africa which could cause governments to change the emission rules to allow for platinum. Although there's no indication that this will happen but we've seen in China that rules can be changed overnight if they want, without any advance warning.
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I very much doubt a return to Pt. It would be extremely expensive for both engineering and legal in the era of homologation.
 
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sgbuyer said:
It has actually happened before. Here's a 2003 report.
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I really don't believe Pt is a feasible substitute for Pd unless Pt price fell maybe into double digits. The costs of substitution would be absolutely massive i.e. re-tuning engines and meeting EU an USA-CA emission regs and we're only talking $100 of Pd in your average $30,000 car.
 
pennys said:
I really don't believe Pt is a feasible substitute for Pd unless Pt price fell maybe into double digits. The costs of substitution would be absolutely massive i.e. re-tuning engines and meeting EU an USA-CA emission regs and we're only talking $100 of Pd in your average $30,000 car.
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In this case, shouldn’t we be buying pd instead as the price can easily rise to $10k per ounce since pd is still in deficit, supply is shrinking and it has no substitute? The investment appeal for pd would be much higher than silver which is in excess supply.

There are all sorts of reports on the Internet for and against pt with respect to autocat. But I only believe in history which showed that the price of pd has crashed 20 years ago after manufacturers started using pt instead.

I've uploaded a long term price chart for palladium.

hQgjdpC.jpg


https://www.macrotrends.net/2542/palladium-prices-historical-chart-data
 
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