China’s appetite for platinum and palladium has improved at the margin, which should help the group establish a firmer price floor, Barclays said in a report.
“We expect both markets to deliver sizeable deficits in 2015, but near-term concerns about demand, particularly from China, have weighed on prices,” Barclays said on Monday.
Platinum futures for July delivery on the Nymex last traded at $1,150.50 per ounce, down 10 percent from the February high of $1,290, while the most-actively traded palladium contract is now at $783.10 per ounce, off about $100 from the 2015 high.
But prices could find support from China, which saw its platinum imports in March rise to their highest level since December 2013, while palladium surged to the highest since August 2014.
“We caution against reading too much into a single data point, but platinum volume on the Shanghai Gold Exchange has also started to respond to local prices trading toward 240 CNY/g. This suggests that China may be becoming more price responsive and that lower prices may fetch better physical interest,” Barclays said.
“Platinum and palladium sponge remains at a premium, indicating that broad industrial demand is still relatively healthy. Switzerland’s trade data, also released last week, allayed concerns of a surge in shipments from Russia, at least for now,” it added.
The post Opportunistic Chinese buyers to support PGM prices – Barclays appeared first on The Bullion Desk.
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