Russia is now out of Palladium sending prices through the roof. North American Palladium is mining the stuff as fast as they can. Their price to mine the stuff is $400 an ounce while the price of Palladium keeps going ever higher. How high will Palladium go? $1000? $1500 $2000??? How high will PAL go? $7? $14? Higher? Much higher? http://seekingalpha.com/article/510...cted-deficit-in-palladium-market?source=yahoo
Something is wrong in that SWC (another Palladium miner) and PAL should be trading much higher when you take into consideration the Palladium price chart. I can only surmise that Palladium mining stocks are unloved right now. If the price of Palladium continues to rise then Im thinking PAL will eventually be noticed.
Smaller mining co's in general have gotten whacked recently - PAL/SWC get lumped in for better or worse. I've got PAL Sept 3$ risk reversal on (short puts and long calls) which wasn't feeling very good at 2.50, but feels great now at 3.00 and hopefully with a runup coming ~
Ah.. the annual "Russian stockpile depletion" article. Been hearing this for 5 years now. Not that I wouldn't mind, since I hold quite a bit of physical. The article also leaves out negative price factors such as enormous efficiency improvements in the next generation of catalytic converters. But go ahead guys knock yourselves out buying. I'd stay away from Stillwater Mine though - last I heard Norilsk was still their majority shareholder plus they have a long history of shady accounting.
The facts are that all of the mines in the world cannot satisfy the demand. The demand has been satisfied through Russia's enduring stockpile and its been 15 or so years since they stopped stockpiling. Just how much is left in their reserves? This isnt some scam, these are cold hard facts. Whenever an asset falls in value, it has to be examined for its potential as a contrarian, value-oriented investment. Such is the case with Palladium. In a commodity bull market, where substantial run- ups have occurred in oil, copper, precious metals, and other raw materials, palladium has escaped the notice of most investors. Even more interesting, is that the price of palladium has declined in the midst of rising demand. I believe that this trend is about to reverse, as the manufacturing community is taking notice of the substantial spread between the two metals that are similar in their industrial use.
Looks like Palladium is on the move again and guess what? It aint down. For shits and giggles lets predict where Palladium is going to stop. $1000? $2000? Russia is fresh out of the stuff and now the only way to solve this problem is price has to rise. Say goodbye to GM and Ford. Back to Davy Jones with ya.