Types of Precious Metals - Investing in Palladium, Rhodium, and other PGMs
Palladium, Rhodium, Ruthenium, Iridium, and Osmium make up the remainder of the Platinum Group Metals (PGMs) and all share similar chemical characteristics. All of the PGMs are rare, however, except for platinum, only palladium and rhodium are currently produced in bullion form for the investment markets. In recent years, both rhodium bullion and palladium bullion have been purchased in increasing quantities among investors who buy bullion in physical form.
Discovered in 1803 and named after the asteroid Pallas, palladium is a silvery-white platinum group metal with atomic number 46 and chemical symbol Pd. With similar chemical characteristics to the other PGMs, palladium is used in a large number of industrial applications. Only recently has it become possible to refine palladium in large amounts. Being a rare and precious metal, palladium has lately become popular among investors who store and buy physical precious metals.
Uses of Palladium Today
Palladium, like platinum, is widely used in catalytic converters for automobiles. This use alone accounts for more than half of the annual production of palladium metal. Palladium is also used in electronic applications, medicine, dentistry, jewelry, and fuel cell technology. Recently, palladium, in the form of palladium bullion, has become a popular bullion metal, and investors have been buying palladium bullion in increasing quantities.
Future of Palladium Prices and Investing in Palladium
Sources of palladium are very rare on Earth. Two complexes, one in South Africa and the other in Russia, account for nearly all of the global palladium production. Indeed, disruptions in the Russian supply have led to some huge increases in the price of palladium. This volatility and potential for large profits have spurred greater interest from investors who buy precious metals bullion, and today, palladium is considered the fourth major precious metal for investment purposes. With industrial demand for palladium growing, and with output still limited to a couple of hundred of tons per year, expect palladium prices to continue to show strong growth.
History of Rhodium
Rhodium was also discovered in 1803 by the very man who discovered palladium. Rhodium is element number 45 and has the chemical symbol Rh. Rhodium is a silvery-white metal that is extremely reflective. For a long time, few uses were round for rhodium outside of using it to electroplate jewelry and utensils, and as an anti-corrosion coating. Rhodium is so rare it has been difficult to produce in any large quantities. Despite this, its important chemical and physical characteristics have still given it important uses in industry.
Uses of Rhodium Today
The annual output of rhodium is only around 30 tons, most of which goes into catalytic converters, which convert harmful automobile exhaust gases into non-dangerous ones. The high reflectivity of rhodium also gives it use as a coating for jewelry, to improve the sheen. Lately, investors have become aware of the rarity of this precious metal and have been buying rhodium bullion to augment their bullion portfolios. Only recently have several precious metals refiners around the world begun to manufacture rhodium products for the bullion and commodity markets.
Future of Rhodium Prices and Investing in Rhodium
Rhodium is extremely rare, and sources of rhodium production are concentrated, like palladium, in South Africa and Russia. Historically the price of rhodium has been very variable. With supply so concentrated, even small disruptions can cause huge spikes in rhodium prices. For example, in 2008 the price of rhodium briefly rose above $10,000 per troy ounce. With rhodium prices now hovering near $1,100 an ounce, investors who buy precious metals clearly see an opportunity for some large profits, and they have been buying rhodium bullion in larger amounts.
Other Platinum Group Metals
The other platinum group metals, ruthenium, osmium, and iridium, are very similar to each other in chemical properties, and are also found in the same ores. Most are obtained as by-products of nickel or copper mining. All these PGMs are outstanding catalysts and all resist tarnish and wear remarkably well. They also have stable electrical properties and great high-temperature characteristics, facts which give all three wide uses in industrial applications.
Investing in Platinum Group Metals
Like all PGMs, ruthenium, osmium, and iridium are extremely rare and valuable. Production of ruthenium, for example, rarely exceeds 12 tons per year. Almost the entire production of these metals is used for their various industrial applications. Though some investors have expressed interest in buying these metals in physical bullion form, at this time no refiner in the world manufactures physical precious metals bullion from any of these rare metals. Certain refiners, such as Johnson Matthey, do list spot ruthenium prices and spot iridium prices, but those are published for those with interest in commodity markets for metals. Unfortunately, investors who prefer to buy bullion forms of these metals have limited options.