Overview of Platinum and Palladium

This chapter describes the production and price of platinum and palladium. Platinum was categorized as a precious metal in 1751 and palladium was isolated as a separate metal in 1803. The use of palladium increased significantly beginning in the 1970s for the development of automobile catalytic converters. Palladium is a primary component in catalytic converters, which are used to reduce vehicle exhaust emissions. Palladium is also used extensively in the electronics, dental, jewelry and chemical sectors. As of mid-2013, five palladium ETFs had total holdings amounting to more than one third of annual global consumption. It is found that while the popularity of palladium ETFs has increased the convenience of investing in the white metal, when profit taking, asset reallocation, or other ETF liquidations occur, ETF holdings of palladium may add to the supply of the metal and exert downward pressure on prices.