The Russian government has stockpiled three million ounces of platinum and around 6.5 million ounces of palladium, CPM Group’s Jeffrey M. Christian told delegates at the LPPM seminar on Tuesday.
Christian said that while Gokhran – the Russian state’s offical gem and precious metal repository – may have claimed that stocks that it wishes to sell have been exhausted, it hasn’t said anything about those that it doesn’t wish to sell, he said.
Large above ground stocks are often cited as the primary reason behind why platinum in particular has failed to react to the current fundamental deficit.
Despite the deficit, prices are now down 50 percent since the all-time peaks hit in 2008 at $2,300 per ounce and the metal recently struck its lowest since the post-peak crash during 2008/2009 at $1,080.
“It has become a hot topic because above ground inventories are the major reason why platinum prices have been so weak since 2012,” he said.
Christian said that CPM Group estimates that at the end of 2014, there were 12 million ounces of refined platinum in above ground stocks.
“They peaked at 13.5 million in 2013,” he said, “but they dropped around 1.2 million to 1.3 million ounces during the strikes.”
Of that 12 million ounces, Christian estimates the Russian government is holding between 2.7 and 3.0 million ounces of platinum that they don’t necessarily want to sell.
Christian also estimates that of that 12 million ounces, 4.6 million are in unreported inventories not held in ETFs.
He also estimates that there are around 25 to 26 million ounces of refined palladium in above ground inventories.
Of that number, the Russian government is holding around 6.5 million ounces and around 12 million ounces of unreported inventories not held in ETFs.
(Editing by Tom Jennemann)
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