Last week was London Platinum Week and the attendees were generally upbeat and more optimistic than last year, and the events were well attended. Perhaps this was because the platinum price had been showing some signs of life in the first few months of the year, rising from just under $800/oz to over $900/oz in April. However, as often seems to be the case in Platinum Week, the price fell, dropping $37/oz to $818/oz. Seasonally, platinum has had the strongest part of its year.
Given the large premium of the palladium price over platinum it was no surprise that the possibility for platinum to be substituted into gasoline autocatalysts was one talking point. Chinese jewellery demand has been declining for several years and Platinum Guild International (PGI) presented the latest view in the Jewellery Business Review.
Substitution of platinum back into gasoline autocatalysts is a possibility. There are a few key criteria for automakers to consider before making a decision. There needs to be a large enough premium of palladium over platinum, with $500/oz being suggested as a sufficient level. The premium reached that level in early January. The platinum and palladium market fundamentals are a consideration, with the availability of palladium a key issue. Since the platinum market is in surplus while palladium is in deficit, this should also push automakers towards substitution. In addition, there is an overriding need to adhere to emissions legislation. The increasingly complex aftertreatment systems used and more stringent emissions tests add to the cost and difficulty of changing formulations.
Companies are focusing on meeting increasingly tight emissions legislation, particularly in Europe and China, and are not in a position to expend time, money and effort on changing catalyst formulations. This suggests that the US is the most likely region where some substitution could occur.
The time from making a decision to investigate substitution to seeing a change in metal demand could be 2-3 years at a minimum. Substitution of 10% platinum in light vehicles in the US could amount to 200 koz of extra platinum demand in 2022, and a similar drop in palladium use, but that assumes that all automakers make the change.
Frederic Bühler, Global Head of Marketing & Sales for Pharmaceutical Ingredients for Heraeus, gave a presentation on Platinum’s Growing Role in the Fight Against Cancers at the LPPM seminar. Platinum-based drugs continue to be a key part of the fight against cancer and with access to medical care expanding in developing economies, their use is likely to grow.