(Kitco News) – Palladium prices have fallen sharply from last month’s record highs, but the metal’s long-term potential will continue to drive prices higher for years, amid an economic downturn, according to one mining executive.
In a recent interview with Kitco News, Michael Jones, president and CEO of Platinum Group Metals (NYSE: PLG TSX: PLG), said that his company continues to move forward with the development of its South African Waterberg PGM project as he sees further growth potential for palladium.
Jone’s comments come as palladium prices have fallen nearly 13% from March’s historic highs. June palladium futures last traded at $1,376.30 an ounce.
In particular, Jones said that demand for palladium will remain strong even if auto sales in the U.S. and China continue to slow. He explained that automakers are having to add more of the precious metal to catalytic converters to meet tighter emission standards.
Although considered a precious metal, palladium’s primary demand comes from the auto sector as the metal is used in catalyst converters to reduce emissions from gasoline engines, the majority of vehicles sold in North American and China. Platinum is the critical metal used to reduce emissions in diesel engines, which were the most popular in Europe.
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