palladium price

As an interesting aside has anyone looked at the price of palladium lately?

currently the price is $585 with the price of platinum $1711

now the interesting part is the platinum equivalent calculation.

As I understand it they calculate the platinum equivalent as follows: (this is from the canadian investor presentation)

PtEq(g/t) = Pt (g/t) + Pd (g/t) x 0.21 + Au (g/t) x 0.52 + Ag (g/t) x 0.01 + Cu (%) x 1.58
+ [Ni (ppm) total -(MgO(%) x 63.49 -587.2)] x 0.00048
+ [Co (ppm) total -(MgO(%) x 3.8188 + 23.94)] x 0.00103

this is based on the old prices of the metals and their recovery grades.

ie: to get the 0.21 multiple for the palladium I think they do the following:

ratio = (price PT * recovery) / (price Pd * recovery)
0.21 = (1200 * .75) / (250 * .75)

now if you do the same for the current prices and the same recovery grades you get

0.34 = (1711 * .75) / (590 * .75)

that means if you assume a 50/50 split between platinum and palladium there is a ~6.5% increase in contained platinum equivalent....

Nice...

please note that these are just my thoughts and ramblings not investment advice...