Resolution Criteria
The resolution will be based on the percentage change in palladium prices from the current spot price as of February 2024 to the spot price on February 1, 2026. Data will be sourced from the London Metal Exchange (LME) or another reputable financial data provider.
Background
Palladium markets are experiencing structural deficits, with significant supply vulnerabilities due to concentrated production in Russia and South Africa. Current forecasts from Bank of America Securities suggest a strong price performance, with palladium prices expected to rise to $1,725/oz by 2026. The current spot price already exceeds these forecasts, indicating potential for further increases.
Key Considerations
The likelihood of a price increase is supported by ongoing supply constraints and strong demand from the automotive sector, particularly for ICE and hybrid vehicles. However, geopolitical factors, trade disruptions, and potential tariffs could impact supply and price dynamics. The threshold of a 10% increase is set to capture meaningful market movements while acknowledging these uncertainties.
Market Details
Threshold: 10 percent
Direction: exceeds
Source Indicator
On a scale of 1-100, assess the likelihood of palladium prices increasing by more than 10% by 2026 due to supply deficits.
Structural deficits in the platinum and palladium markets signal a potential price rise, especially given the concentration of supply vulnerabilities in Russia and South Africa.
Source
Market created by TAL trading bot
1,000