(MENAFN- Baystreet.ca) Palladium is increasingly being used in vehicle catalytic convertersdesigned to reduce harmful emissions for engines still using petroleum. Itscontinued demand in the automobile industry, despite efforts to switch to EVs,has been a major factor in the steady increase in its value.
Palladium remains a vital product in the automobile industry, alongwith cobalt and lithium that are used to make EV batteries. Palladium, inparticular, is highly demanded in this industry because it is used toneutralize toxic pollutants by turning them into water vapor and carbondioxide. Its growing value makes it an attractive pursuit for mining companiesincluding North American Palladium Ltd. (TSE: PDL) (OTC: PALDF), Vale S.A.(NYSE: VALE) and Anglo American Platinum (OTCMKTS: ANGPY)
21C Metals is one of the newer junior miners with keen interest inprecious metals such as palladium used in the automotive industry. 21C Metals'(CSE:BULL ; OTC:DCNNF )assets include the Tisova cobalt and copper project near the border of Germanyand the Czech Republic, and its recently acquired palladium projects inOntario, Canada. This base gives 21C Metals operations in prolific miningregions of both Europe and North America.
Mechanism of working of Catalytic converters
A large portion of the palladium supplied to the market is used by theautomotive industry. Regulatory authorities in different regions across theworld have tightened their emissions standards on combustion engine vehicles.Palladium is used in catalytic converters to remove hydrocarbons, carbonmonoxide, and other harmful gases from exhaust emission.
A catalytic converter is one of the most expensive parts of a car,costing up to $1,000. The reason they are so costly is that they use expensivemetals to promote chemical reactions that remove harmful components fromexhaust gases. With time, the catalyst in the converter gets degraded and needto be replaced.
Manufacturers normally spread palladium over a large surface area ofthe converter for them to be effective. With time the surface area can lessenbecause metal atoms move and form large particles that reduce surface area. Inorder to counter sintering, manufacturers will use huge amount of metals sothey can convert emissions to standards for the lifespan of the car of up to 15years. Since the converters can decline in their effectiveness and requirereplacing, its expected that the demand for palladium will continue to be high.
Growing value of palladium
Platinum has, for a long time, been the most valuable metal that isused in catalytic converters. However, palladium has taken over as the mostvaluable metal this year with its value going well past platinum. The value ofthe rare metal was $1,429.05 per ounce at the time of this news. Palladium hasperformed exceptionally well in the market over the past few years with itscurrent value doubling in price from 2017 to the present.
The growing value of palladium is attributed to an increase in demandas a result of most car manufacturers shunning the use of platinum andpreferring to use palladium. Regulations on emissions are helping to drivedemand. Vehicles using fossil fuels still dominate the market by a huge margincompared to electric vehicles, and it is not yet clear how the EV will affectdemand for gasoline vehicles. For now, the demand is high, and so palladiumrules the day.
21C Metals enhancing palladium exploration
21C Metals revealed in mid-July that it launched exploration effortsat the Tisova cobalt and copper project near the German- Czech border. Theexploration activities aim to determine the potential of the project to producean adequate and economic amount of the metals. The company delegated the job ofcompiling comprehensive geological data to the German firm Beak Consultants.
Prior to launching exploration, 21C Metals announced that it acquiredthe Agnew Lake Property after talks with its advisors and also after reviewingthe geological database of the Ontario government. 21C Metals is continuing itsexploration on the property and remains optimistic about its prospects for thepalladium project. The company has so far completed about 20km of line cuttingin its East Bull project in Canada. Its researchers collected 70 samples todetermine palladium mineralization, and the results are anticipated shortly.21C Metals also plans to carry out prospecting and sampling at East Bullproject this month.
Leveraging the market
It is worth noting that despite the automotive industry's continuedadoption of materials such as palladium for use in environmental efforts, theindustry desperately is working to shift towards electric vehicles. But withEVs accounting for only about 4% of the entire automotive market worldwide, thedemand for petroleum cars will remain a key driver for palladium.
Mining companies and the corresponding supply chains should expect tobenefit from increased interest for palladium, as well as cobalt and lithiumthat are important in the manufacture of EV batteries. Companies at theforefront of supplying both of these industries include;
North American Palladium Ltd. (OTC: PALDF), carries out activities inThunder Bay Ontario where they are exploring minerals in their Sunday Lakeproperty. Recently the company said that it was expanding its PGM zone atSunday lake.
Vale S.A. (NYSE: VALE) has a base metal segment that explores andmines non-ferrous metals and its by-products such as silver, gold, cobalt, andpalladium among others. The company is actively involved in mining activitiesin the Sudbury basin in Ontario as well as in Manitoba, where its Thompsonproduces nickel.
Anglo American Platinum (OTCMKTS: ANGPY) is a South Africa basedcompany, and a world leader in the mining of palladium. It is also the largestproducer of platinum, accounting for over 38% of the world's platinum supply.Anglo American recently announced that it is considering the manufacture ofelectric car batteries using the platinum group of metals.
For a more on palladium, platinum, cobalt, and the upside for marketssupplying these metals, view the report at USA News Group:https://usanewsgroup.com/2019/06/17/this-car-metal-keeps-hitting-new-records/
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