Palladium Supported by Dollar Moves and Supply Tightness

Palladium futures were around $1,260 an ounce, not far from July-highs touched early in September, with short-term swings driven by dollar sentiment and the looming risk of a US government shutdown.

Over the medium to long term, prices remain underpinned by structurally tight market fundamentals.

On the supply side, production is highly concentrated, with Russia and South Africa accounting for roughly 80% of global output, leaving the market exposed to geopolitical and operational risks.

Long-term investment in new mines remains limited, while rising production costs in regions such as North America continue to constrain supply flexibility.

Demand trends are more nuanced.

While the shift toward electric vehicles is eroding palladium’s core role in gasoline vehicle catalytic converters, industrial consumption—particularly in electronics and chemicals—remains solid.