Platinum & Palladium Survey Platinum & Palladium Survey 2011 2011

Launch Presentation Launch Presentation 55

th th
May 2011 May 2011
London London Philip Klapwijk Philip Klapwijk
Johannesburg Johannesburg Paul Walker Paul Walker
GFMS gratefully acknowledges the generous GFMS gratefully acknowledges the generous
support of the following companies for this years support of the following companies for this years support of the following companies for this years support of the following companies for this years
Platinum & Palladium Survey Platinum & Palladium Survey
Platinum in 2010 Platinum in 2010
Palladium in 2010 Palladium in 2010
Outlook for 2011 Outlook for 2011 Outlook for 2011 Outlook for 2011
Highlights of 2010 Highlights of 2010 - - Platinum Platinum
Mine production up 2%, mainly due to South Africa. Mine production up 2%, mainly due to South Africa.
R li i d b 0 26 R li i d b 0 26 Recycling increased by 0.26m oz. Recycling increased by 0.26m oz.
Demand for autocatalysts & industrial rose by 0.94m oz Demand for autocatalysts & industrial rose by 0.94m oz y y y y
But jewellery & retail investment dropped by 0.63m oz But jewellery & retail investment dropped by 0.63m oz
Gross surplus of 0.96m oz, 57% taken by ETFs Gross surplus of 0.96m oz, 57% taken by ETFs
Visible stocks rise to 3 5moz at end 2010 Visible stocks rise to 3 5moz at end 2010 Visible stocks rise to ~3.5m oz at end 2010 Visible stocks rise to ~3.5m oz at end 2010
Average price jumped by 34% to a new high of $1,609 Average price jumped by 34% to a new high of $1,609
Platinum Supply Rose 5% to 7.69m oz in 2010 Platinum Supply Rose 5% to 7.69m oz in 2010
Mine output up by 2% to 4.75m oz, mainly South Africa Mine output up by 2% to 4.75m oz, mainly South Africa
First time increase since 2007 First time increase since 2007
G i i RSA dZi b b d dl l h G i i RSA dZi b b d dl l h Gains in RSA and Zimbabwe exceeded losses elsewhere Gains in RSA and Zimbabwe exceeded losses elsewhere
Rising costs were offset by a considerable rise in platinum prices Rising costs were offset by a considerable rise in platinum prices
Old j ll li j d 30%t 0 60 Old j ll li j d 30%t 0 60 Old jewellery recycling jumped 30% to 0.60m oz Old jewellery recycling jumped 30% to 0.60m oz
Higher scrap from both J apan and China Higher scrap from both J apan and China
Driven by rising prices and increasing pool of jewellery stocks. Driven by rising prices and increasing pool of jewellery stocks. y gp gp j y y gp gp j y
Autocatalyst recycling rebounded 15% to 0.90m oz Autocatalyst recycling rebounded 15% to 0.90m oz
KeydriversincludestrongPGM andsteel pricesandan KeydriversincludestrongPGM andsteel pricesandan Key drivers include strong PGM and steel prices and an Key drivers include strong PGM and steel prices and an
improvement in recycling efficiency improvement in recycling efficiency
All markets saw higher scrap, with Europe posting the largest rise All markets saw higher scrap, with Europe posting the largest rise
Platinum Mine Production; Platinum Mine Production;
Winners& Losersin2010 Winners& Losersin2010 Winners & Losers in 2010 Winners & Losers in 2010
Implats
Aquarius
Royal Bafokeng
A l
Others
Norilsk
Winners
Northam
Stillwater
Amplats
Winners
Losers
Vale
Artel Amur
Northam
-100 -50 0 50 100 150
Source: GFMS Source: GFMS ( (Platinum & Palladium Survey 2011) Platinum & Palladium Survey 2011)
(000 ounces) (000 ounces)
South African Mine Production Costs South African Mine Production Costs
PlatinumEquivalent (R/kg) PlatinumEquivalent (R/kg) Platinum Equivalent (R/kg) Platinum Equivalent (R/kg)
R500000
R600,000
R500000
R600,000
R400,000
R500,000
R400,000
R500,000
Average Pt price 2010
R200,000
R300,000
R200,000
R300,000
Average Pt price (2009)
R100,000
R200,000
R100,000
R200,000
All-in costs per in 2010 ($1,469/oz))
Total cash costs per kilo in 2010 ($1,081/oz)
R0 R0
0 10 20 30 40 50 60 70 80 90 100
Platinumequivalent production(%) Platinum equivalent production (%)
Note: All Note: All--in costs includes depreciation, sustaining capex, overheads, mine in costs includes depreciation, sustaining capex, overheads, mine- -site exploration & exceptionals such as retrenchment site exploration & exceptionals such as retrenchment
Source: GFMS Source: GFMS ( (Platinum & Palladium Survey 2011) Platinum & Palladium Survey 2011)
Global Global Platinum Supply Platinum Supply
Riseinbothmineproductionandrecycling Riseinbothmineproductionandrecycling Rise in both mine production and recycling Rise in both mine production and recycling
1600
1800
8.0
9.0
1200
1400
6.0
7.0
600
800
1000
3 0
4.0
5.0
U
S

$
/
o
z
m
i
l
l
i
o
n

o
z
200
400
600
1 0
2.0
3.0
m
0
200
0.0
1.0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
S thAf i i i Oth i i South African mining Other mining
Autocatalyst recycling Old jewellery scrap
Source: GFMS Source: GFMS ( (Platinum & Palladium Survey 2011) Platinum & Palladium Survey 2011)
Headline Headline Supply Supply -- Platinum Platinum ppy ppy
000 oz 000 oz 2009 2009 2010 2010 +( +(--)) 000 oz 000 oz 2009 2009 2010 2010 +( +(--))
MineProduction MineProduction
6,048 6,048 6,186 6,186 138 138
Mine Production Mine Production
,, ,,
Autocatalyst Recycling Autocatalyst Recycling
780 780 898 898 118 118
Oldj ll S Oldj ll S
463 463 603 603 140 140
Old jewellery Scrap Old jewellery Scrap
463 463 603 603 140 140
Total supply Total supply
7,291 7,291 7,687 7,687 396 396
(Excludingsuppliesfromabove (Excludingsuppliesfromabove--ground groundstocks stocks)) (Excluding supplies from above (Excluding supplies from aboveground ground stocks stocks))
Source: GFMS Source: GFMS ( (Platinum & Palladium Survey 2011) Platinum & Palladium Survey 2011)
Platinum Demand in 2010 Platinum Demand in 2010
Demand Demand - - Platinum Platinum
000 oz 000 oz 2009 2009 2010 2010 +( +(- -) )
A t t l t A t t l t
2588 2588 3006 3006 419 419
Autocatalysts Autocatalysts
2,588 2,588 3,006 3,006 419 419
Industrial Industrial
1,230 1,230 1,750 1,750 520 520
J ewellery J ewellery
2,292 2,292 1,894 1,894 (398) (398)
Retail Investment Retail Investment
305 305 76 76 (229) (229)
Total Total
6,415 6,415 6,725 6,725 311 311
Note: autocatalyst & jewellery are gross fabrication demand, others are net Note: autocatalyst & jewellery are gross fabrication demand, others are net
Source: GFMS Source: GFMS ( (Platinum & Palladium Survey 2011) Platinum & Palladium Survey 2011)
Autocatalysts Demand Autocatalysts Demand in in 2010 2010 -- Platinum Platinum
Vehicle production up 23% and diesel rose 27% Vehicle production up 23% and diesel rose 27%
Platinum use up 16% to 3.0m oz after a hefty decline in Platinum use up 16% to 3.0m oz after a hefty decline in p y p y
2009, but still 26% below the peak in 2007 2009, but still 26% below the peak in 2007
E t d th l t i i l t E t d th l t i i l t Europe posted the largest increase in volume terms, Europe posted the largest increase in volume terms,
helped by Euro 5 and a rebound in LV production helped by Euro 5 and a rebound in LV production
Higher demand also due to tight standards & higher Higher demand also due to tight standards & higher
average loadings average loadings average loadings average loadings
But gains were limited by ongoing substitution losses But gains were limited by ongoing substitution losses
both in gasoline & diesel both in gasoline & diesel
Global Global Vehicle Production Vehicle Production
Up23%in2010, developedmarketsincrease21% Up23%in2010, developedmarketsincrease21% Up 23% in 2010, developed markets increase 21% Up 23% in 2010, developed markets increase 21%
80
90
60
70
Other regions
China
J apan
+120
40
50
i
o
n

u
n
i
t
s
J apan
North America
Europe
+15
20
30
40
m
i
l
l
i
+66
+58
0
10
20
+160
Labels show change in
platinum demand in
2010; up 419 koz
0
2006 2007 2008 2009 2010
Source: Source: GFMS, IHS Automotive GFMS, IHS Automotive
Global Vehicle Production & Platinum Global Vehicle Production & Platinum
U i A t t l t U i A t t l t Use in Autocatalysts Use in Autocatalysts
Production 77m units Platinum 3.0m oz
Light diesel Heavy diesel
Gasoline
Light diesel Heavy diesel
Gasoline
Note: basis 2010 data Note: basis 2010 data
Source: Source: GFMS, IHS Automotive GFMS, IHS Automotive
Global Global Light Vehicle Production Light Vehicle Production - - Diesel Diesel
Up27%in2010but Europerise23% Up27%in2010but Europerise23% Up 27% in 2010 but Europe rise 23% Up 27% in 2010 but Europe rise 23%
18
20
14
16
10
12
o
n

u
n
i
t
s
Other regions
China
J
6
8
m
i
l
l
i
o
J apan
North America
Europe
2
4
Europe
0
2006 2007 2008 2009 2010
Source: Source: IHS Automotive IHS Automotive
Global Global Autocatalyst Demand Autocatalyst Demand -- Platinum Platinum
20 0 3 5
17.5
20.0
3.0
3.5
12.5
15.0
2.0
2.5
m
i
l
l
i
n

o
z
10.0 1.5
o
n

u
n
i
t
s
m
i
l
l
i
o
n
5.0
7.5
0.5
1.0
2.5 0.0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Pt in gasoline Pt in diesel Light diesel production (rhs)
Source: Source: GFMS, IHS Automotive GFMS, IHS Automotive
Industrial Applications Industrial Applications Platinum Platinum
1.75m oz in 2010 1.75m oz in 2010 up 42% up 42% pp
2.5
2.0
z
Glass
1 0
1.5
M
i
l
l
i
o
n

o
z
Electronics
Petroleum
0.5
1.0
M
Chemicals
Other
0.0
2001 2003 2005 2007 2009
Source: GFMS Source: GFMS ( (Platinum & Palladium Survey 2011) Platinum & Palladium Survey 2011)
J ewellery J ewellery Demand Demand in in 2010 2010 -- Platinum Platinum
Fabrication down 17%to 1 89moz Fabrication down 17%to 1 89moz Fabrication down 17% to 1.89m oz Fabrication down 17% to 1.89m oz
All major markets, except North America, registered decline All major markets, except North America, registered decline
China down 26% to 1.18m oz China down 26% to 1.18m oz
Rising prices and elevated stocks reduced fabrication demand Rising prices and elevated stocks reduced fabrication demand
Manufacturersswitchedto24 Manufacturersswitchedto24--carat goldtowardsyear carat goldtowardsyear--end end Manufacturers switched to 24 Manufacturers switched to 24 carat gold towards year carat gold towards year end end
North America & Europe North America & Europe total total 0.42m oz (up 6%) 0.42m oz (up 6%)
Off k i N hA i lif db i h l Off k i N hA i lif db i h l Offtake in North America was lifted by a recovery in the luxury Offtake in North America was lifted by a recovery in the luxury
end of the market end of the market
European demand saw substitution losses into carat palladium European demand saw substitution losses into carat palladium
j ll hi h i j ll hi h i jewellery on higher prices jewellery on higher prices
Fabrication in Japan dropped by 3% to 0.26m oz Fabrication in Japan dropped by 3% to 0.26m oz p pp y p pp y
After a rebound in 2009, long After a rebound in 2009, long- -term downtrend resumed term downtrend resumed
Chief drivers were weak economy and higher prices Chief drivers were weak economy and higher prices
Platinum J ewellery Platinum J ewellery Gross Fabrication Demand Gross Fabrication Demand
$1 500
$1,800
3.0
3.5
$1,200
$1,500
2.5
z
Other
$900
1.5
2.0
M
i
l
l
i
o
n

o
z
Europe
North America
$300
$600
1.0
M
J apan
China
$0
$300
0.0
0.5
Pt US$ (rhs)
2001 2003 2005 2007 2009
Source: GFMS Source: GFMS ( (Platinum & Palladium Survey 2011) Platinum & Palladium Survey 2011)
Supply & Supply & Demand Demand -- Platinum Platinum ppy ppy
000 oz 000 oz 2009 2009 2010 2010
Headline Supply Headline Supply
7,291 7,291 7,687 7,687
Fabrication Demand Fabrication Demand
6,415 6,415 6,725 6,725
Gross Surplus (Deficit) Gross Surplus (Deficit)
876 876 962 962
p ( ) p ( )
We consider this the preferred measure of platinums We consider this the preferred measure of platinums p p p p
underlying fundamentals. underlying fundamentals.
Gross surplus implies an increase in above Gross surplus implies an increase in above--ground stocks. ground stocks.
Source: GFMS Source: GFMS ((Platinum & Palladium Survey 2011) Platinum & Palladium Survey 2011)
Supply & Supply & Demand Demand -- Platinum Platinum
000 oz 000 oz 2009 2009 2010 2010
Gross Surplus (Deficit) Gross Surplus (Deficit)
876 876 962 962
Gross Surplus (Deficit) Gross Surplus (Deficit)
Other Stock Activity: Other Stock Activity:
Industry De Industry De--stocking stocking
665 665 0 0
ExchangeTradedFunds* ExchangeTradedFunds*
(384) (384) (550) (550)
Exchange Traded Funds Exchange Traded Funds
( ) ( ) ( ) ( )
Sub Sub--total total
281 281 (550) (550)
Residual Surplus (Deficit) Residual Surplus (Deficit)
1,157 1,157 412 412
* N i b f ETF i di ddi i l i * N i b f ETF i di ddi i l i * Negative numbers for ETFs indicate net additional investment * Negative numbers for ETFs indicate net additional investment
Source: GFMS Source: GFMS ((Platinum & Palladium Survey 2011) Platinum & Palladium Survey 2011)
World Investment World Investment Platinum* Platinum*
2500 2000
2000
2500
1500
2000
Net Value of World Net Value of World
Investment Investment
1500
1000
1500
M
u
n
c
e
s
Investment Investment
1000
500
M
i
l
l
i
o
n

U
S
$
h
o
u
s
a
n
d

o
u
0
500
0
T
h
-500
0
-500
2005 2006 2007 2008 2009 2010 2005 2006 2007 2008 2009 2010
*World Investment is the sum of retail investment, net growth in ETF and residual surplus (deficit) *World Investment is the sum of retail investment, net growth in ETF and residual surplus (deficit)
Source Source: GFMS : GFMS ( (Platinum & Palladium Survey 2011) Platinum & Palladium Survey 2011)
Palladium Palladium
Highlights Highlights of 2010 of 2010 - - Palladium Palladium
Mine production up by 5% in 2010, mainly South Africa. Mine production up by 5% in 2010, mainly South Africa.
T t l l b 8% li l li b d T t l l b 8% li l li b d Total supply rose by 8%, as recycling also climbed. Total supply rose by 8%, as recycling also climbed.
Total demand was up by over 1.0m oz. Total demand was up by over 1.0m oz.
Demand from autocatalysts reached a 10 Demand from autocatalysts reached a 10--year high. year high.
Gross deficit was 0.55m oz, versus near balance in 2009. Gross deficit was 0.55m oz, versus near balance in 2009.
Russian stock sales estimated at 0 8moz exceeded by Russian stock sales estimated at 0 8moz exceeded by Russian stock sales estimated at 0.8m oz, exceeded by Russian stock sales estimated at 0.8m oz, exceeded by
ETF gains. ETF gains.
P i d i b i t t d b t t t l t P i d i b i t t d b t t t l t Prices driven by investment and robust autocatalysts Prices driven by investment and robust autocatalysts
demand. demand.
Palladium Supply in 2010 Rose to 8.07m oz Palladium Supply in 2010 Rose to 8.07m oz
Mine production up 5%, after 3 years of losses Mine production up 5%, after 3 years of losses
Output increased in South Africa, Canada and Russia Output increased in South Africa, Canada and Russia
In contrast, the United States posted a slight fall In contrast, the United States posted a slight fall
Autocatalyst recycling increased by 21% to 1.29m oz Autocatalyst recycling increased by 21% to 1.29m oz
More than reversed the decline seen in 2009 More than reversed the decline seen in 2009
Strong PGM prices and improved recycling efficiency were Strong PGM prices and improved recycling efficiency were
behind the rise behind the rise
Old jewellery scrap surged by 40% to 163,000 ounces Old jewellery scrap surged by 40% to 163,000 ounces
The majority came from retailers inventories in the Chinese The majority came from retailers inventories in the Chinese
k h fid i ll di j ll ff d k h fid i ll di j ll ff d market, where confidence in palladium jewellery suffered market, where confidence in palladium jewellery suffered
Palladium Demand in 2010 Palladium Demand in 2010
Demand Demand - - Palladium Palladium
000 oz 000 oz 2009 2009 2010 2010 +( +(- -) )
Autocatalyst Autocatalyst
4028 4028 5222 5222 1194 1194
Autocatalyst Autocatalyst
4,028 4,028 5,222 5,222 1,194 1,194
Industrial Industrial
2,283 2,283 2,513 2,513 229 229
J ll J ll
1110 1110 809 809 (301) (301)
J ewellery J ewellery
1,110 1,110 809 809 (301) (301)
Retail Investment Retail Investment
170 170 75 75 (95) (95)
Total Total
7,591 7,591 8,618 8,618 1,028 1,028
Note: autocatalyst & jewellery are gross fabrication demand, others are net Note: autocatalyst & jewellery are gross fabrication demand, others are net
Source: GFMS Source: GFMS ( (Platinum & Palladium Survey 2011) Platinum & Palladium Survey 2011)
Autocatalyst in Autocatalyst in 2010 2010 -- Palladium Palladium yy
Dominated by global gasoline vehicle production. Dominated by global gasoline vehicle production.
Gasoline vehicle output grew by 23% globally, with Gasoline vehicle output grew by 23% globally, with
China posting the strongest absolute gain China posting the strongest absolute gain China posting the strongest absolute gain. China posting the strongest absolute gain.
Palladium demand surged 30% to 5.2m oz. Palladium demand surged 30% to 5.2m oz.
Substitution gains in diesel & gasoline, due to Substitution gains in diesel & gasoline, due to
ll di t d t l ti d j ll di t d t l ti d j palladiums cost advantage over platinum, and a major palladiums cost advantage over platinum, and a major
recovery in car production. recovery in car production.
Global Global Light Gasoline Production Light Gasoline Production up 23% up 23%
Developed markets rise 21%, emerging markets up 25% Developed markets rise 21%, emerging markets up 25% p g g p p g g p
50
60
40
50
Other regions
China
J
+144
30
i
o
n

u
n
i
t
sJ apan
North America
Europe
+233
20
m
i
l
l
i
p
+337
+147
0
10
+334
Labels show change in
palladium demand in
2010 119
0
2006 2007 2008 2009 2010
2010; up 1.19m oz
Source: Source: GFMS, IHS Automotive GFMS, IHS Automotive
Industrial Applications Industrial Applications Palladium Palladium
2 5
3.0
2.0
2.5
Oth
1.5
M
i
l
l
i
o
n

o
z
Other
Electronics
h i l
0 5
1.0
M
Chemical
Dental
0.0
0.5
2001 2003 2005 2007 2009
Source: GFMS Source: GFMS ( (Platinum & Palladium Survey 2011) Platinum & Palladium Survey 2011)
J ewellery in J ewellery in 2010 2010 -- Palladium Palladium
Global jewellery demand fell by 27% to 809,000 oz Global jewellery demand fell by 27% to 809,000 oz
The fall in Chinese fabrication dominated the global declines; if The fall in Chinese fabrication dominated the global declines; if
China is excluded, the drop was limited to 7% China is excluded, the drop was limited to 7%
Chinese offtake slumped by 40%to a seven year low Chinese offtake slumped by 40%to a seven year low Chinese offtake slumped by 40% to a seven year low Chinese offtake slumped by 40% to a seven year low
Loss of confidence in palladium by the trade, despite high margins Loss of confidence in palladium by the trade, despite high margins
Handicapped by lack of marketing of the metal, no SGE trading Handicapped by lack of marketing of the metal, no SGE trading
hi hh l dt l k f i t & VAT hi hh l dt l k f i t & VAT which has led to a lack of price transparency, & VAT which has led to a lack of price transparency, & VAT
Demand elsewhere also faltered Demand elsewhere also faltered
US demand weakened by 7%, due partly to the shift to silver and US demand weakened by 7%, due partly to the shift to silver and
non non--precious metals jewellery precious metals jewellery
DemandinJ apanremainedbroadlyflat DemandinJ apanremainedbroadlyflat Demand in J apan remained broadly flat Demand in J apan remained broadly flat
In contrast, European demand for carat palladium jewellery rose In contrast, European demand for carat palladium jewellery rose
Supply & Supply & Demand Demand -- Palladium Palladium Suppy& Suppy& e a d e a d a adu a adu
000 oz 000 oz 2009 2009 2010 2010 000 oz 000 oz 2009 2009 2010 2010
Headline Supply Headline Supply
7,504 7,504 8,067 8,067
Fabrication Demand Fabrication Demand
7,591 7,591 8,618 8,618
Gross Surplus (Deficit) Gross Surplus (Deficit)
(87) (87) (551) (551)
Gross Surplus (Deficit) Gross Surplus (Deficit)
(87) (87) (551) (551)
We consider this the preferred measure of palladiums We consider this the preferred measure of palladiums p p p p
underlying fundamentals. underlying fundamentals.
Grossdeficit impliesared ctioninabo e Grossdeficit impliesared ctioninabo egro ndstocks gro ndstocks Gross deficit implies a reduction in above Gross deficit implies a reduction in above--ground stocks. ground stocks.
Source: GFMS Source: GFMS ( (Platinum & Palladium Survey 2011) Platinum & Palladium Survey 2011)
Supply & Supply & Demand Demand - - Palladium Palladium
000 oz 000 oz 2009 2009 2010 2010
Gross Surplus (Deficit) Gross Surplus (Deficit)
(87) (87) (551) (551)
Gross Surplus (Deficit) Gross Surplus (Deficit)
(87) (87) (551) (551)
Other Stock Activity: Other Stock Activity: Other Stock Activity: Other Stock Activity:
Russian State Sales Russian State Sales
1,100 1,100 800 800
E h T d dF d * E h T d dF d *
(507) (507) (1033) (1033)
Exchange Traded Funds* Exchange Traded Funds*
(507) (507) (1,033) (1,033)
Sub Sub--total total
593 593 (233) (233)
Residual Surplus (Deficit) Residual Surplus (Deficit)
507 507 (784) (784)
* Negative numbers for ETFs indicate net additional investment * Negative numbers for ETFs indicate net additional investment
Source: GFMS Source: GFMS ( (Platinum & Palladium Survey 2011) Platinum & Palladium Survey 2011)
World Investment* World Investment* -- Palladium Palladium
700 2500
600
2000
400
500
1500
M
i
l
l
o
u
n
c
e
s
Net Value of World Net Value of World
Investment Investment
300
1000
l
i
o
n

U
S
$
T
h
o
u
s
a
n
d

o
100
200
500
T
0 0
2005 2006 2007 2008 2009 2010
*World Investment is the sum of retail investment, net growth in ETF and residual surplus (deficit) *World Investment is the sum of retail investment, net growth in ETF and residual surplus (deficit)
Source Source: GFMS : GFMS ( (Platinum & Palladium Survey 2011) Platinum & Palladium Survey 2011)
Platinum Platinum Outlook for 2011 Outlook for 2011
Platinum Platinum Outlook for 2011 Outlook for 2011
Supply to rise by around 0.5moz Supply to rise by around 0.5moz Supply to rise by around 0.5m oz Supply to rise by around 0.5m oz
South Africa & Russia expected to stabilise South Africa & Russia expected to stabilise
North America to gain strongly North America to gain strongly
Autocatalyst recyclingset toclimbfurther Autocatalyst recyclingset toclimbfurther Autocatalyst recycling set to climb further Autocatalyst recycling set to climb further
Old jewellery scrap also likely to rise in response to prices Old jewellery scrap also likely to rise in response to prices
Demand to edge higher, but remain below pre Demand to edge higher, but remain below pre- -crisis level crisis level
Autocatalystsgrowthratetoslowfollowinglast yearsrecovery Autocatalystsgrowthratetoslowfollowinglast yearsrecovery Autocatalysts growth rate to slow following last year s recovery Autocatalysts growth rate to slow following last year s recovery
Substitution & thrifting to hamper rate of increase Substitution & thrifting to hamper rate of increase
Industrial demand to grow modestly Industrial demand to grow modestly
Retail investment toremainfar belowthehighsof 2008/2009 Retail investment toremainfar belowthehighsof 2008/2009 Retail investment to remain far below the highs of 2008/2009 Retail investment to remain far below the highs of 2008/2009
J ewellery offtake to be curbed by higher prices & stocks J ewellery offtake to be curbed by higher prices & stocks
Gross surplus to recur in 2011 Gross surplus to recur in 2011 likely to be up on 2010 likely to be up on 2010
Gainsinautocatalysts& industrial demandoffset bysupplyrise Gainsinautocatalysts& industrial demandoffset bysupplyrise Gains in autocatalysts & industrial demand offset by supply rise Gains in autocatalysts & industrial demand offset by supply rise
Price sensitive jewellery demand may also suffer Price sensitive jewellery demand may also suffer
Nonetheless, support from investors seems set to continue Nonetheless, support from investors seems set to continue
L i t t t f i hi hi fl ti L i t t t f i hi hi fl ti Low interest rates, currency fears, worries over high inflation Low interest rates, currency fears, worries over high inflation
Although the global economic recovery remains fragile Although the global economic recovery remains fragile
Platinum Exposure Platinum Exposure ETFs & Nymex Futures ETFs & Nymex Futures
$2,000
$2,500
3.0
3.5
$1,500
$2,000
2.0
2.5
o
z
$1,000
10
1.5
m
i
l
l
i
o
n

o
$500
0.5
1.0
$0 0.0
Apr-07 J an-08 Oct-08 J ul-09 Apr-10 J an-11
ZKB ETFSLondon ETFSNewYork J uliusBaer ZKB ETFS London ETFS New York J ulius Baer
Other ETF Nymex net long Price (rhs)
Source: Source: GFMS, CFTC, respective ETF issuers GFMS, CFTC, respective ETF issuers
Platinum Platinum Forecast Forecast TTrading Range rading Range to to End End- -2011 2011
(J an (J an Apr 2011average$1793 Apr 2011average$1793 range$161) range$161) (J an (J an--Apr 2011 average $1,793 Apr 2011 average $1,793 range $161) range $161)
$2,500
$2,000
$1,925 $1,925
$1,500
$1,675 $1,675
$1,000
$500
Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11
London 2nd fix forecast low forecast high
Source: Source: GFMS, Thomson Reuters GFMS, Thomson Reuters
Palladium Palladium Outlook for 2011 Outlook for 2011
Palladium Palladium Outlook for 2011 Outlook for 2011
Supply expected to rise by 0 4 Supply expected to rise by 0 4--0 5moz 0 5moz Supply expected to rise by 0.4 Supply expected to rise by 0.4--0.5m oz 0.5m oz
Subdued gain in mine production, mostly from North America Subdued gain in mine production, mostly from North America
Sharp rise in autocatalyst scrap, reaching almost 20% of total supply Sharp rise in autocatalyst scrap, reaching almost 20% of total supply
Demand growth to broadly match increase in supply Demand growth to broadly match increase in supply
Autocatalyst to rise on higher vehicle production (gasoline) Autocatalyst to rise on higher vehicle production (gasoline)
G i f US b b lik l b k i E G i f US b b lik l b k i E Gains from US may be strong but likely to be weak in Europe Gains from US may be strong but likely to be weak in Europe
Effects of disaster in J apan may be considerable, home & abroad Effects of disaster in J apan may be considerable, home & abroad
Growth in China may slow down significantly Growth in China may slow down significantly y g y y g y
J ewellery & retail investment J ewellery & retail investment both likely to decline both likely to decline
Gross deficit to remain high, similar level to 2010 Gross deficit to remain high, similar level to 2010
Russian Russian stock sales stock sales to stay broadly flat, around 0.8m oz. to stay broadly flat, around 0.8m oz.
Sentiment towards palladium to remain positive Sentiment towards palladium to remain positive
Macroeconomicconditionslikelytostaysupportiveof investment; Macroeconomicconditionslikelytostaysupportiveof investment; Macroeconomic conditions likely to stay supportive of investment; Macroeconomic conditions likely to stay supportive of investment;
ETFs have climbed strongly so far this year. ETFs have climbed strongly so far this year.
Palladium Exposure Palladium Exposure ETFs & Nymex Futures ETFs & Nymex Futures
$700
$800
$900
3.5
4.0
$500
$600
$700
2.5
3.0
o
z
$300
$400
1.5
2.0
m
i
l
l
i
o
n

o
$100
$200
0.5
1.0
$0 0.0
Apr-07 J an-08 Oct-08 J ul-09 Apr-10 J an-11
ZKB ETFSLondon ETFSNewYork J uliusBaer ZKB ETFS London ETFS New York J ulius Baer
Other ETF Nymex net long Price (rhs)
Source: Source: GFMS, CFTC, respective ETF issuers GFMS, CFTC, respective ETF issuers
Palladium Palladium Forecast Forecast TTrading Range rading Range to to End End- -2011 2011
(J an (J an--Apr 2011average$786 Apr 2011average$786 range$158) range$158) (J an (J an--Apr 2011 average $786 Apr 2011 average $786 range $158) range $158)
$1,000
London 2nd fix forecast low forecast high
$975 $975
$800
g
$975 $975
$400
$600
$650 $650
$200
$400
$0
Jan 05 Jan 06 Jan 07 Jan 08 Jan 09 Jan 10 Jan 11 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11
Source: Source: GFMS, Thomson Reuters GFMS, Thomson Reuters
Disclaimer
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