LONDON - World palladium demand is expected to slump by 24 percent in 2001, mainly because automakers and the electronics industry are switching to cheaper metals and other precious metals, according to refiner Johnson Matthey PLC.
"This is not a surprise. With prices having escalated so much, many automakers switched to platinum," said Jeremy Coombes, the refiner's marketing general manager.
Palladium demand in the auto industry, where the metal is used for catalytic converters, is expected to fall by 14 percent to 4.84 million ounces in 2001, the lowest level for three years.
In the electronics industry, demand is shrinking by more than 50 percent to a 19-year low of 1.05 million ounces.
"The broad conclusions reached in the report are as we read them as well," said Keith Rumble, CEO of world No. 2 platinum producer Impala Platinum Holdings Ltd. "We might have differences on the magnitude of numbers, but the broad conclusions are correct," he said.