End of Russian palladium exports may result in world market shortage – by Eugene Gerden (InvestorIntel.com – November 18, 2015)

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Russia may significantly reduce exports of strategic rare earth elements to foreign markets during the next several years, despite the recently announced state plans for a significant expansion of their domestic production.

It is planned that at the initial stage such restrictions will apply to palladium, huge reserves of which were accumulated by the country during the Soviet era, which allowed Russia to become one of its world’s largest exporters of the metal in recent years.

In recent years exports of palladium from the reserves of Russian State Precious Metals and Gems Repository (Gokhran) has been varied in the range of 14-15 tonnes, however there is possibility that they might be completely stopped already starting from 2016.

The official volume of palladium reserves in Russia is a state secret. According to the British research company GFMS, during the period of 2005-2009 Russia exported in an average of 34 tonnes of palladium per year, while in recent years these figures have significantly declined.

The end of supplies may result in a sharp rise of prices for palladium in the global market and will lead to the fact that Russia will no longer have a major impact on the world palladium market.

The end of exports of Russian palladium may result in a shortage of the metal in the world market. At present palladium is mostly used in the production of automotive catalysts, while its shortage may result in a significant increase of the costs of automakers.

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