North American Palladium Ltd. (fka PALDF)

[Dobie Lama]

PAL- gonna rise again..............

Palladium Rises to 13-Year High on Expectations of Low Supplies

DOW JONES & COMPANY, INC. 10:38 AM ET 07/08/14

Palladium prices hit a new 13-year high Tuesday, as the market is faced with dwindling supplies of the metal in the aftermath of South Africa's miners' strike.

Palladium for September delivery, the most-actively traded contract, was recently up 0.6% to $873.75 a troy ounce on the Comex division of the New York Mercantile Exchange. Prices climbed to $876 an ounce earlier in the session, the highest level since February 2001. Platinum, which is often mined together with palladium, was up 0.7% to $1,505.40 a troy ounce.

Investors believe the two metals, which are used mainly as a component in car-exhaust filters, are in short supply after a strike by South African miners halted production at several key mines for five months. South Africa is the world's largest producer of platinum and its second-largest palladium producer. Although the strikes ended in June, it will take several months for the mines to reach their former capacity.

Meanwhile, auto sales in the U.S., Europe and China are climbing. BMW AG was the latest car maker to report strong numbers, after the company announced Tuesday that it had sold more cars than ever before in the first half of the year, helped by strong demand in China.

"It's going to be awhile until everyone is back at work and producing, and inventories build up to previous levels," said Frank McGhee, head of precious metals at Integrated Broker Services. "The rally is starting to look a bit overdone, but that doesn't mean it can't continue."

Prices for platinum and palladium are up 9% and 24% this year, respectively.

In other markets, gold prices shuffled between gains and losses, as investors weighed a stronger U.S. economy against continued conflicts in Ukraine, Israel and Iraq. Some investors use gold as a hedge against political and economic uncertainty.

Gold for August delivery, the most-actively traded contract, was recently at $1,317.30 a troy ounce, broadly unchanged for the session. The contract has traded in a range of $1,315.60 to $1,325.70 an ounce Tuesday.