Palladium

Palladium weekly special report based On 1.00 Lot Calculation:

PALLADIUM USE AND MARKET SHARE:

• Palladium is mostly used in catalytic converters by the car industry to reduce harmful gas emissions while tightening regulation is forcing automakers to put more Palladium into each vehicle, which in turn could keep the demand outlook positive. Palladium has also been used in fuel cells to generate power.
• MARKET SHARE (PRODUCERS): Russia is the largest producer holding 43% of the markets, while South Africa is the second largest with 33.00% of the markets. Canada is third on the list with 9.5% of the global production.
• MARKET SHARE (CONSUMERS): China is the largest Palladium consumer with 31%, while Europe and North America (USA) hold 20% each. Japan stands at 11%.
• RUSSIA EXPECTED TO CUT PRODUCTION IN 2024: NORNICKEL, THE LARGEST PALLADIUM PRODUCER IN THE WORLD, TO CUT PRODUCTION IN 2024. The Russian miner said the output of the metal may fall almost 15% to as low as 2.3 million ounces. The company said that its production was down 17% year on year in Q4 of 2023.

CHINA:

• MOST RECENT ECONOMIC DATA IN CHINA (FEBRUARY): Exports in February increased by 7.1%, exceeding analysts’ expectations for an increase of 1.9%. Imports rose by 3.5%, beating analysts’ expectations for an increase of 1.5%. In addition, Inflation came out at 0.7%, up from the previous -0.8%.
• NEW STIMULUS PACKAGES IN Q1 OF 2024: CHINA CENTRAL BANK CUT THE RESERVE REQUIREMENT RATIO (RRR) FROM FEBRUARY 5. For some context, China went with two RRR cuts in 2023 i.e. one in March and one in September. They were both for 0.25% points each. There will be a hefty reduction this time around, as the Chinese central bank announces a 0.50% points cut to the reserve requirement ratio (RRR), from 10.5% to 10%. This could release around 140 billion dollars to the economy. This is on top of the expected stimulus of 278 billion dollars.
• CHINA REOPENS ITS ECONOMY (2023): China’s COVID-Zero policy has ended. The Chinese government is no longer ordering lockdowns and quarantines. China’s Vice Premier Liu He said the economy could rise to its pre-COVID growth trends in 2024.

EVENTS (CHINA):

• MARCH 18 AT 03:00 GMT: CHINA INDUSTRIAL PRODUCTION (FEBRUARY). Analysts expect to see an increase of 4.9%, down from January’s increase of 6.8%.

EVENTS (USA):

• MARCH 20 AT 18:00 GMT: US FEDERAL RESERVE INTEREST RATE DECISION. The US Fed will meet next week with markets expecting that the bank will start cutting interest rates in June, currently at 5.50%. The rates are expected to come down to at least 4.75% by the end of the year. The Fed will also announce its inflation, GDP and unemployment projections for the rest of 2024 and beyond. If the Fed points to a more aggressive rate-cutting cycle, metal prices, including the Palladium price, could continue rising in value.

PALLADIUM: PRICE ACTION

• BREAKING: PALLADIUM HAS TESTED ITS LOWEST PRICE SINCE AUGUST 2018 ($848). The Palladium price has fallen around 20% since the start of the year, becoming at one point cheaper in price than Platinum for the first time in five years.

ANALYST EXPECTATIONS 2024:

SOURCE: Bloomberg

PALLADIUM, March 15, 2024
Current Price: 1090

Example of calculation base on weekly trend direction for 1.00 Lot¹

1. 1.00 lot is equivalent of 100 units
2. Calculations for exchange rate used as of 10:00 (GMT) 15/03/2024
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• You may wish to consider closing your position in profit, even if it is lower than suggested one.
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