Monday May 15, 05:35 PM PLATINUM SUPPLIED SET TO FALL FOR EIGHTH YEAR: STUDY
LONDON (AFP) - Platinum is likely to be in short supply for the eighth year running in 2006, the brokerage Johnson Matthey said in a closely-watched report.
There was a shortage of 70,000 ounces on the platinum market in 2005 when supplies fell short of expectations, the reseach group said in its annual review.
Platinum was bolstered by strong demand from the car industry, which uses the metal in catalytic converters, while palladium has enjoyed keen interest from the Chinese jewellery sector.
Platinum prices struck a historic high point 1,340 dollars per ounce last Friday to show a 36-percent jump in value so far this year.
Last week record-breaking metal prices won support from low global stockpiles, supply disruptions, a weak US dollar, tensions over Iran and inflation fears prompted by high oil prices.
Johnson Matthey said that there was "no end in sight to the current commodities bull market".
However there was likely to be a production surplus of sister metal palladium for the sixth year running in 2006, the report added.
"With South African mine output expanding, and Russia continuing to sell state stocks, another surplus in supply in 2006 is likely."
Total mine supplies of palladium exceeded demand in 2005 to the tune of 1.35 million ounces, Johnson Matthey added.
The price of palladium could reach as high as 420 dollars per ounce this year as a result of speculative demand, according to the report.
Palladium hit 406.50 dollars per ounce last Friday, marking the highest point since January 2002.
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