Issue link: http://resourceworld.uberflip.com/i/1239546
A P R I L / M A Y 2 0 2 0 www.resourceworld.com 45 platinum will be supported this year by rising PGM loadings on heavy duty trucks in China and India, where stricter emission legislation is due to be implemented in 2020. However, we expect this to be off - set by further erosion of platinum jewelry demand and a drop in purchasing in the glass sector." The JM report went on to state that "interest among automakers is rising, but 2020 is still too early to see significant substitution of platinum into gasoline emissions catalysts." It was obvious that the JM report was written before the Coronavirus outbreak in China so it remains to be seen how this will affect Chinese platinum and palladium demand. Since February 2016, palladium has had a great run-up from US $467/oz to a high of US $2,414/oz. The metal was trading at US $1,997/oz on April 21. During 2019, all-time highs were seen in the palladium price as the market moved over a million ounces into deficit. The JM report noted that "intensifying use of palladium in gasoline cars in Europe and China pushed auto demand to a record level, despite falls in vehicle output. Industrial demand fell slightly, mainly due to slowing world economic growth. The rate of ETF redemptions fell sharply despite the rise in price, and during the second half of 1019 there were signs of a return to positive investment buying." According to the JM report, the pal - ladium deficit is likely to deepen in 2020, as an increasing number of Chinese and European vehicles meet… [higher emissions standards]. Efforts to reduce palladium consumption in the automotive industry are unlikely to prevent demand rising in 2020. Remaining ETF holdings of palladium are not enough to offset the shortfall in supply." For rhodium, Johnson Matthey fore - casts a slight deficit as it looks at 2019 numbers. Total rhodium supply for 2019 is estimated at 746,000 oz with total demand pegged at 1,144,000 oz minus 372,000 oz from autocatalyst recycling, leaving a defi- cit of 772,000 oz. There are opposing forces at work that affect the prices of PGMs. The JM report commented that "With a muted outlook for supplies and potential upside in autocata - lyst demand, platinum could see further interest from investors in 2020, especially if economic uncertainty continues to support the gold price, and platinum's dis - count to gold remains at record levels." Meanwhile, considering the fact that, in addition to electric cars, there will soon be electric SUVs and pickup trucks that don't need catalytic converters, lessening PGM demand that will be counter-balanced by increasing sales of gasoline and diesel vehicles which account for about 80% of palladium demand.Depending on how quickly auto makers build electric vehicles and phase out internal combustion engines coupled with how quickly the worldwide driving public buys electric vehicles, we will just have to wait and see how it plays out. Moreover, as JM notes, "the autocata - lyst recovery industry [in China] is still relatively underdeveloped, and the precise trajectory of future growth is still uncer - tain." Basically, buoyed by strong demand, the PGM industry will remain healthy but just how healthy is unknown. Below are profiles of various PGM explorers and miners. The world's major PGM producers include Norilsk Nickel [GMKN-Moscow; NILSY-OTC], Anglo American Platinum Ltd. [AMS-Jo'burg, Brussels], Sibanye- Stillwater [SGL-Jo'burg; SBGL-NYSE], Impala Platinum Holdings Ltd. [IMP- PLATINUM PALLADIUM