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Heraeus Precious Appraisal

  • Edition 3 - 19th February 2018

Small metals, big prices – but how great are the risks?

Using the platinum price as a baseline shows that ruthenium is now relatively expensive – as iridium has been for some time.

Iridium and ruthenium are high-tech metals that are used for their unique electronic, thermal and catalytic properties, not just as lower-cost alternatives to platinum.

However, with prices rising over the past year at a much faster rate than those of the other PGMs, the question is whether current end-uses are at risk from substitution and damage to demand.

Iridium and ruthenium are used extensively in industrial processes which often require considerable capital outlay. Both metals are utilised as electrode coatings in bulk electrochemical processes, where they are used to replace a less environmentally-friendly process, so this portion of demand is considered relatively price-insensitive and less at risk from substitution. Iridium crucibles are in high demand for the production of materials for components for smartphones and computers and may be at risk from lower-cost base metals, but at the moment their purity and durability are valued. Moreover, in both applications the metals can be recycled and their value can be recovered.

They are also used in consumer products, from which it is difficult to recycle the metal. Ruthenium is vital in materials used to increase data storage in hard disk drives and in components to enable effective mobile communications. These are fast-moving and competitive markets, where high performance is crucial, so ruthenium demand appears relatively secure for now, although there is always the risk of a new technology emerging that performs better at lower cost.

While sustained high prices have the potential to reduce some of the more elastic demand for iridium and ruthenium, these metals are well established in several processes and components where it will be quite difficult to substitute them out, so it is reasonable to expect that current relatively high prices can be tolerated for some time.

Northam Platinum has opened a new state-of-the-art smelter at the Zondereinde mine that significantly expands Northam’s capacity. Heraeus Precious Metals has a long standing partnership with Northam and invested €20 million in the smelter and will continue to refine Northam’s expanding output. See press release for details.

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This report has been compiled using information obtained from sources that Heraeus and SFA (Oxford) Ltd (“SFA”) believe to be reliable but which they have not independently verified. Further, the analysis and opinions set out in this document, including any forward-looking statements, constitute a judgment as of the date of the document and are subject to change without notice.

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Precious Metals Update Archive 2017

  • Rhodium
  • Gold
  • Silver
  • Iridium
  • Palladium
  • Platinum
  • Ruthenium
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