In a surprising turn of events, over the past two days, the palladium price has increased. Additionally, it has surpassed its more famous brother metal, platinum. 2017 has seen a steady surge in palladium price, and this month has pushed it higher than the cost of platinum for the first time since January of 2001.

There are a few factors that could attribute to this climb.

Palladium’s biggest customer is the automobile industry. This is an industry that makes up 80% of its demand. Carmakers use palladium in the making of catalytic converters for gasoline-powered and hybrid-electric vehicles. Meanwhile, platinum powers diesel vehicles. As consumers move more towards environmentally-friendly vehicles, these hybrid cars are rising in demand. As a result, diesel vehicles falter. The scandal last year in Europe, where carmakers were found to be falsifying the emissions tests for their diesel vehicles, has further contributed to the decreasing demand for diesel-powered automobiles.

This Palladium price parity could also be due to palladium’s largest producer, South Africa. Their currency (the rand) has seen a healthy few years. As the rand strengthens, South Africa’s exports increase in price. Indeed, this filters into a rising cost for this precious metal.

Interestingly enough, 2017 is the first year when the US Mint has ever issued American Palladium Eagle. So, this fact may also affect the rising Palladium price.

Following the Act passed by Congress in 2010 to create this coin, a third-party study, commissioned by the Treasury Secretary, started. The reasoning was to determine the demand it could generate. One finding of this study was concern about the unpredictability of the palladium market at the time. While it was relatively new on the scene, it could slot into the industrial metals trade as opposed to precious metals. Ultimately, the enthusiasm of numismatists kept its release on track. Coincidentally or not, the Palladium Eagle has released this year. The Eagle would be the newest edition of one of the most popular coin series in the world, the American Eagle series.

On Wednesday, platinum hit its lowest spot price in 16 years.

The price of one ounce of platinum buys .9901 ounces of palladium. Palladium was available on Wednesday for $919.50 an ounce. Platinum was down to $917.49 an ounce. Thus far this year, the Palladium price has increased by 35% — however, platinum was at only a 2% increase at this point in 2017.

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