Palladium has been notably weak compared to its PGM peers. Is this purely an industrial demand story related to the auto sector, or is the substitution effect with platinum gaining more traction than initially anticipated?
Could there also be a speculative element at play here? Sometimes weakness in a commodity can be amplified by short interest, rather than purely fundamental drivers. Just a thought.
It's definitely a mix of both, but I lean more towards the substitution gaining serious momentum. Manufacturers aren't waiting around for palladium to rebound when platinum is a viable, cheaper alternative right now.
I think you're spot on with the industrial demand being a major factor. The auto sector, especially with the EV push, isn't going to have the same palladium needs. Substitution just adds another layer to that.