Strong demand from several industrial sectors propelled rhodium prices this week to levels last seen in March 2012, according to market sources.
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The Platts New York Dealer rhodium price range rose to $1,250-$1,530/oz from $1,200-$1,305/oz last week, with some sources citing sales as high as $1,550/oz.
"There could have been a couple of buyers, but I was only aware of one," one PGMs refiner said, putting this week's range of physical deals at $1,295-$1,530/oz.
"The question is, 'when are they going to take their foot off the pedal?' They were basically buying it up in front of themselves," the refiner said of the large buyer. "There's less and less volume at each [price] level."
Most sources believe automotive companies were the main buyers, and that they were taking their cue from recent inversion of palladium and platinum prices.
Platinum can be substituted for palladium in the catalytic converters of gasoline-powered vehicles, but that requires more rhodium to effectively control greenhouse gas emissions and atmospheric pollutants.
"I think the palladium story is ultimately driving the rhodium story," one physical dealer said, putting this week's range at $1,305-$1,530/oz. "Palladium going to a premium [over platinum] is pushing rhodium higher."
Palladium first traded above platinum on September 27 for the first time in 16 years, and also traded above $1,000/oz on October 16 for the first time in 16 years.
NYMEX palladium for December delivery ended this week at $969.85/oz, while NYMEX platinum for January delivery closed at $926.80/oz.
But a second PGMs refiner said companies in other industrial sectors were also active buyers of rhodium. Rhodium is also alloyed with platinum to make reinforcement fiber for the high-tech glass on consumer electronics, and used as a catalyst to make certain chemicals.
Base prices of major European refiners rose nearly $50-$75/d, which suggests strong demand from multiple industrial sectors.
UK-based Johnson Matthey and Germany-based Engelhard Materials Services (BASF) closed this week at $1,575/oz after ending last week at $1,315/oz and $1,340/oz, respectively.
RUTHENIUM DEMAND REMAINS STEADY
Ruthenium prices ticked higher this week on steady, low-volume demand. The Platts New York Dealer price range for ruthenium rose to $80-$86/oz, the highest level since July 2013, from $72-$82/oz last week.
The first PGMs dealer cited earlier said he believed speculative investors were buying ruthenium after eyeing the recent rallies in palladium and rhodium.
"I think there was a little bit of spec interest that came in and said, 'I'll buy here at $80-$85/oz. What's the worst that can happen?' " he said, putting this week's range at $75-$93/oz.
But volumes remain small, a third PGMs refiner/recycler said. "There weren't a huge number of transactions," he said, putting this week's range at $80-$85/oz.
"People showed some interest in the low-$80s level, but I don't think people are really selling. They want to hold it a little longer," he said.
Most ruthenium today is used in computer disc drives, electrical contacts and chip resistors. But prices began rising last month on talk of new applications in semiconductors and nanotechnology.