Analysts see a long tail for PGMs use in traditional internal combustion engines, and a drop in supply as mining becomes less economic has kept prices relatively well supported. But with fellow precious metal gold at all-time highs this year, that’s a disappointing performance. “The PGM sector is facing a shift in which palladium and rhodium will see declining demand with no major alternative demand sector on the forecast horizon,” Wilma Swarts, head of PGMs at consultancy Metals Focus, told Reuters. By Polina Devitt and Ashitha Shivaprasad for Reuters

Young people are skipping “pleasurable consumption” and instead purchasing “asset-style jewelry” such as gold beans for adornment and investments, said Nikos Kavalis, managing director at the London-based consultancy Metals Focus Ltd. However, he cautions that it makes no sense to invest in gold beans — or other gold items — because their price is often 10% to 30% higher than the commodity’s spot price. Investors would be better served by parking money in gold ETFs, he said. By Bloomberg News

Russia’s new silver mine Prognoz, one of two major projects coming online around the world this year, will start selling silver concentrate in the third quarter of 2024, its owner told Reuters on Wednesday. Global silver output from mines is expected to rise by 4% this year to 843 million troy ounces, the highest level in six years, partly due to the commissioning of Prognoz, according to the Silver Institute and consultancy Metals Focus. By Anastasia Lyrchikova and Polina Devitt for Reuters

Jewellery demand is forecasted to grow by 6%, led by India, according to the Silver Institute and Metals Focus, a precious metals research consultancy based in London. India is expected to drive most of the increase, benefiting from a positive economic outlook and consumers becoming accustomed to higher silver prices in rupees. In contrast, soft consumer sentiment in the US and Europe may dampen jewellery consumption, but retailers restocking is likely to offset the impact. By GJEPC

As in the past, gold remains a safe haven asset, with investors flocking to it during uncertain times including black swan events such as COVID-19. Metals Focus MD, Philip Newman explains, “ Towards the end of 2022, there was a high demand for small bars and coins in Europe and the US.” However, he points out that institutional investors, such as hedge funds, view the situation differently. “Their focus has very much been on how the US Federal Reserve bank will behave in terms of its rate policy. Barring another crisis next year, I believe that this will remain the key driver for 2024.” By Mining Review Africa

The presence of above-ground stocks and investor shorting outweighed physical shortages, according to Metals Focus, which analyses precious metals markets. A reduction in Chinese PGM imports this year and continuing concerns about the rate of China’s growth is set to continue the theme of depressed metal prices in 2024. “Looking ahead to this year, we anticipate a continuation of these dynamics,” it says in a report published this month. By David McKay for Mining Mx

Platinum and palladium are effectively interchangeable in gasoline autocatalysts, which account for 80% of total palladium demand. Consultancy Metals Focus estimates total palladium and platinum demand at 9.7 million ounces and 8.1 million ounces, respectively. “We are already seeing substitution slowing down or in some cases stopping,” said Nikos Kavalis at Metals Focus, adding that the process would eventually reverse. “It won’t be an overnight change, as autocatalyst designs can happen a long time before cars actually come off the production line.” By Brijesh Patel and Polina Devitt for Reuters

Global demand for silver will likely decline 10 per cent in 2023 with offtake of silver jewellery and silverware declining by 22 per cent and 47 per cent, respectively, with India being the prime factor behind the dip. Key findings reported by Philip Newman, Managing Director at Metals Focus, and Sarah Tomlinson, Director of Mine Supply, during the Silver Institute’s Annual Silver Industry Dinner showed that globally, total silver demand is forecast to ease by 10 per cent to 1.14 billion ounces in 2023. By Subramani Ra Mancombu for The Hindu Business Line

During a recent conversation I had with Sarah Tomlinson, Director of Mine Supply at international consulting and research firm, Metals Focus, she mentioned that investors look for favourable conditions when deciding to put their money in mining. This include political stability, favourable tax laws and proper infrastructure. By Gerard Peter for Mining Review Africa

“At this point in time, we see no reason why the Fed will alter its course of remaining hawkish for much of 2024. So we don’t think interest rates will be cut until very late next year. So under that scenario, as the market moves towards the Fed’s position, we think you will see liquidations by investors and then that will gradually weigh on the prices. So we think gold will gradually weaken and head towards $1,900 per ounce and then head back towards $1,800 level as we move through 2024,” Newman told CNBC-TV18. By Manisha Gupta for CNBC-TV18

Despite a challenging economic backdrop, global silver industrial demand is expected to achieve a new all-time high in 2023, according to Metals Focus. This, coupled with a slight dip in total supply, will see the silver market post another sizeable deficit in 2023. Overall demand is expected to fall by 10% year on year to 1.14 billion ounces in 2023 – thanks to weaker investment demand — but this drop must be set against 2022’s record high total, Metals Focus says. By Reuben Adams for Stockhead

Metals Focus, an independent precious metals research consultancy, released a note recently that said it expects the increased demand for chips powering AI technology to drive “widespread support for a range of precious metals bearing components.” Industrial and tech demand for precious metals has been muted this year due to sluggish global economic activity. For instance, the demand for gold in the tech and industrial sector was down 3% year-on-year in the third quarter with offtake in the electronics sector dropping by 4%. By ZeroHedge for OilPrice.com

It’s often said there is a negative correlation between rates and gold, but not always. There are times when gold and rates increase, such as in the 1970s. More recently, gold had a trough-to-peak rally of nearly 28% and missed the record in 2022 by less than $10 an ounce, during which time the Fed took policy rates to levels not seen since before the 2008 global financial crisis, according to Metals Focus, a UK research house. By David McKay for Mining Mx

To cope with the evolution of AI algorithms, shipping growth for AI servers and switches will rise by double digits over the next few years and stimulate precious metals demand, Metals Focus said. Demand will rise for platinum alloys used in chip manufacturing, silver-palladium Ag-Pd multi-layer ceramic capacitors (MLCCs) in high power components, gold bonding wire in chip and memory packages, gold plating in printed circuit boards and palladium plating on lead frames, it added. By Ashitha Shivaprasad and Arpan Varghese for Reuters

Demand from the sector could reach 170-180 million ounces if new PV installation exceeds 400 gigawatts (GW) by 2025, said Philip Newman at consultants Metals Focus. However, solar panel manufacturers, having long been mindful of silver supplies after the price briefly hit $50 per ounce in 2011, will continue to reduce silver loadings through structural design improvements, Newman added. By Ashitha Shivaprasad for Reuters

Platinum’s return will provide a timely reminder to a mining industry rule that minerals such as rhodium are byproducts — and no-one mines for byproducts alone, says Metals Focus’s Swarts. “Short-term price spikes are ultimately value-destructive”, she says. Learning this lesson will be valuable as platinum, and other minor metals such as iridium and ruthenium, take centre stage in the development of “green hydrogen” — a vast industry, driven by the world’s decarbonisation needs and extending into a multitude of industrial sectors. By David McKay for Mining Mx