Don't know the difference between platinum and palladium? You are not alone. Both of them have a natural whitish-grey colour and similarities in their molecular makeup. They also have similar industrial applications. This can make it difficult to tell the difference between the two.
So, what is platinum? It is a precious metal with countless uses. While it is primarily used by automotive industries as a catalyst to better the efficiency of fuel cells, it is just as important to the chemicals industry for producing nitric acid, benzene and silicone. It is also widely used in the jewellery industry. Almost half of the metal's annual supply goes to the automotive industry to make catalytic converters. It’s 15 to 20 times rarer than gold and it is more durable.
This begs the question: what is palladium? Palladium is one of the six platinum group metals (PGMs). It is a rare metal (30 times more rare than gold) and most of its world’s supply is extracted from mines in Russia, the United States of America, South Africa, and Canada. Like platinum, it is used to make automotive catalytic converters, electronic components and jewellery. Palladium is available in greater quantities than platinum. This has increased its demand to be used as an alternative to platinum. Traditionally palladium sells for about half the price of platinum. However, recent increases in demand have caused the price of palladium to soar above that of platinum. As of now, palladium’s spot price is more than $1000 over that platinum, with palladium reaching all-time highs of around $2300 / oz. Astoundingly, palladium’s price is forecasted to increase further as platinum prices trends downwards.
We are all wondering the same thing: how are they different? Truth is, they are uncannily similar in their makeup and their applications. On top of that, they also look indistinguishable visually with a bright white/silvery colour with little to no tarnishing overtime. Differences exist in the supply of the metals, which affects their demand and their prices.
In light of the abovementioned reasons, one may conclude that platinum and palladium must be popular investment choices. Due to their limited supply, the prices are highly volatile which encourages speculative traders to invest in the metals.