The Explosive Rise of Palladium Futures
The palladium future recorded an explosive increase to a 2-year high in the past trading week. With a weekly gain of +12.38% and a closing price of $1,289 per ounce, the price reached its highest level since August 2023.
Causes for the Increase
The sharp price rise was primarily triggered by the escalation of international trade conflicts. In particular, the announcement of high U.S. tariffs on various imports, including punitive tariffs against Canada and other trading partners, led to palladium being in high demand as a classic safe haven in geopolitically tense times.
Role of Leading Producers
Another important factor contributing to the volatility of the palladium price is the concentration of production: about 80% of the global supply comes from Russia and South Africa. Therefore, political tensions or escalations between the U.S. and Russia could quickly lead to further price jumps.
Outlook for Palladium
Despite this current surge, experts like Metals Focus expect that the supply-demand ratio could ease in the medium term. A price of around $1,100 per troy ounce is forecasted for the end of 2025; the following year, an oversupply could even emerge. Thus, the upward potential of the price is considered to be limited.
Opportunities and Risks for Investors
For investors, this explosive rise presents opportunities for short-term profits due to geopolitical uncertainties. However, they should be cautious due to the high volatility of the market, possible political risks, and fundamental demand weaknesses in the automotive sector.
Conclusion
The price increase signals possible changes in the commodity market that are relevant for savers and investors—especially concerning geopolitical risks and industrial demand development.