Also, the London Metal Exchange (LME) said oit was closely monitoring nickel and other metals after prices surged as Western sanctions against Russia disrupted supply from the major producer. It gave no indication of what action it could take or whether it might be similar to previous action.
Russia produces about 6 per cent of the world's aluminium, 10 per cent of global mined nickel and 3.5 per cent of world copper supply.
Coal prices, too, surged.
Spot palladium was up 10.2 per cent at $3,308.49 per ounce by 5:46 pm IST, on course for its biggest daily percentage rise since March 2020 having hit an all-time high of $3,440.76 earlier.
“Palladium is reflecting deep scarcity, and anticipation of further scarcity as things unfold in Ukraine and Russia," independent analyst Ross Norman said, adding he expected the price rally to continue. Western nations have piled sanctions on Moscow, driving prices higher across a range of commodities. Russia accounts for 40 per cent of global production of palladium, used by automakers in catalytic converters to curb emissions.
“Possible supply outages from Russia are still being priced in on the palladium market,” Commerzbank analysts said in a note. “As supply outages could not be offset elsewhere, the market risks sliding into a sizeable supply deficit.”
Spot gold gained 1 per cent to $1,988.46 per ounce, after scaling its highest since August 19, 2020 at $2,002.31 earlier in the session.
“The severity of the war in Ukraine and the uncertainty around its future trajectory have fuelled broad-based gold buying from safe-haven seekers, pushing prices towards $2,000 per ounce,” Julius Baer analyst Carsten Menke wrote in a note. “A further escalation would likely lift prices further. The latter would likely have a more lasting impact, as it could push the world economy towards a stagflation scenario, which we see as very bullish for gold.”
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