Lets Talk Rhodium

Though not what i would call a main stream PM, i basically had never even
Heard of it, well maybe in passing but that,s about it, ran in to it by accident
Tonight when i was looking for some Palladium, has similar uses as palladium
like for automotive industry catalytic converters and such but is also used to
enhance Platinum for corrosive resistance in other applications that it is used
For also is used in the Nuclear reactor system as well.

As you can see by the chart above Rhodium is really picking up steam !! in one
Year it has basically went from $625 to over a $1,000 !! those are my kind of
Numbers !! the amazing part it did this in just about a 12 month run.

As far as investing in it you are very limited from what i found just bars
and one or two coins and that,s about it, even far less then Palladium and
I thought that was bad...LOL

So looks like a race horse on steroids, might be something worth thinking about ?

 

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Rhodium plated base metal items get cashed in from time to time. I also break the cores out iridium plugs and a bucket load does well.

 

Thermocouples- wire like devices that are made of several metals. thermocouples can contain platinum, palladium, nickel, rhodium, tungsten, and even small quantity of gold, you can find in stoves, coffee makers, refrigerators, air conditioning. Great info on the Rhodium

 

I like thermocouples, tig electrodes, carbide cutters and more. Rhodium plated scrap still remains the easiest way to get high value rhodium for me.

 

Remember when rhodium went to $8,000 per ounce?

 

That hasn't been that long ago............

 

It,s far and away the most rarest PGM, and as we can see a huge upside with only
about 10 mines producing it in the world with most of those being in South Africa
You can only wonder where it can go from here !

 

yet many other metals are even more expensive and we will deplete our silver reserves in the foreseeable future at the current rate of consumption v mining

 

where I live in New Jersey right by George Washington Bridge, scrap yard prices are slowly going back up right now I am getting 45 cent a pound for aluminum cans, compared to other yards , 25 cent a pound and 15 cent for aluminum cans

 

the rate of processing rhodium "sponge" is about 20 weeks for the size not much
Bigger then a coffee can, so any disruption at all could send it through the roof !!
just not enough of it to respond to changes especially if there was a civil war
in the region something like that.

 

Was in the air conditioning field for 25 plus years, and scrap copper was the big thing, # 1 was .95 cents and #2 was .35 use to come home with about $500 a month and this was back in the early 80.s

 

copper tubing # 1 $2.07 lb. # 2 $ 1.89 1b.

 

I would have liked to have those prices back then how about bright and shinny ?
That,s the stuff they take out when the do demos on buildings.

The #2 price seems very high to me as it is usually less then 50% of #1, #2 would
Be considered dirty, with paint or adhesive on it.

 

#1 bare bright wire $2.35 lb. insulated copper wire cat 5/6 74 cent lb. and the # 2 is the bus bar $ 1.89 1b. Rockaway Recycling is the latest price as of today

 

In June 2008, rhodium hit $10050 per ounce. (No, I did not type an extra digit by mistake.)

In November 2008, rhodium hit $1000 per ounce. (No, I did not leave out a digit.)

Help yourself.

 

I believe today it is at $ 1015 per ounce

 

What was it before it took off to the 10k level?

 

Before going into 2008, I want to know why no one has mentioned that rhodium's primary use (on the scale of 98-99% of global consumption) is as a catalyst. Its specific consumption is in the production of fiber optics, but is recovered near 100% from that.

Now onto 2008... 2007 ended with an expected shortage of rhodium supply, relative to consumption. This was exacerbated by fears in 2008 that an African mine would be short of power due to gov't decisions to divert energy to consumers, rather than industry. This was later found to be false, as the gov't chose to allow PGM miners/refiners to use the energy, as those industries generated the highest return per kwh. Thinly traded supply led to a spike and crash, based upon the rumor and reality.

Now, there's an alternate theory posited by Jack Lifton, that is a great read (http://www.resourceinvestor.com/200...-6-billion-value-out-minor-metal-market-month): He basically claims that the reason for the spike/crash was due to someone selling down rhodium stock (six months worth) in 2005, under the assumption that the price would never shift. This led to the company paying a premium (additional demand in a thinly traded market) of $2k per oz. In turn, this led to the successor attempting to replenish the stockpile and profit on future demand by buying up 18 months worth of stock. This further drove up short-run demand. Once the stockpile was established, they stopped buying, which cause the price to drop. With the price drop, someone at the company panicked and sold off the stockpile.

I like Mr Lifton's theory a lot better than the South African one, as it's simply funnier (unless you're a shareholder of the firm that caused the mess).

Realistically, rhodium price is directly driven by demand, as supply of the metal is essentially an afterthought of PGM mining. The industrial consumers have their own recovery systems in place to reuse what they already have, either in house or through a industrial recovery contract. Consumption increases only when additional output is needed. Unless industries that use the metal start seeing accelerated growth, it's unlikely that the metal will deviate from its historical trendline, absent some sort of odd scenario.

Edit:

Given rhodium was priced at $790 or so in 2004, and historical inflation sits around 3.22% (ignoring that we have had historically low artificial/official rates of inflation since 2007), a price around $1195. If we take into account the official inflation rates, that comes in closer to $1014.

 

If you are seriously considering meaningful investments into physical PGMs, research the markets that impact their demand and where those markets have been and where they are going. Research the price spikes we've seen in the last 10 years or so and what caused them. PGM's are commodities and are subject to some different market conditions than Gold or Silver which are widely established as monetary assets as well as commodities. Having some just to have some is cool. One of the rarest elements on the planet is a good conversation starter. But a greater investment in physical PGMs does have a not-insignificant risk.

I am not overly bullish on PGMs long term per my other posts in the Palladium thread.

Also, physical Rhodium will typically carry ridiculous premiums compared to other consumer bullion products, especially fractional pieces. Check buy sell spreads before you get into it too much.