Rhodium Set for Biggest Weekly Gain in 17 Months as ETP Lists
Rhodium gained, heading for its biggest weekly increase in 17 months, after Deutsche Bank AG listed a physically backed exchange-traded product for the metal in London.
Deutsche Bank listed the DB Physical Rhodium product on the London Stock Exchange on May 24, according to information on the bourse’s website. The metal, mainly used in car pollution- control devices and also in the chemical and glass industries, dropped 20 percent this year through last week.
“The new physically-backed exchange-traded commodity continues to tempt buyers into the market,” Greg McKinnell, a precious-metals trader at London-based Johnson Matthey Plc, said today in an e-mailed report. “Rhodium has been slowly moving lower over the last few months but interest has now increased following the ETC launch, with consumers and investors looking to catch the market on the way up.”
Rhodium for immediate delivery rose 3.6 percent to $2,175 an ounce by 2:46 p.m. in London, according to data from Johnson Matthey on Bloomberg. It’s up 12 percent this week, the most since December 2009 and the first weekly increase since February. Prices reached as high as $10,100 in 2008, a year after demand climbed to the highest level since at least 1984, Johnson Matthey data show.
Demand climbed 22 percent to 873,000 ounces last year, halving the metal’s surplus to 114,000 ounces, Johnson Matthey said on May 16. The metal is mainly produced as a by-product of platinum mining in South Africa, according to Deutsche Bank.
Providers are tapping into the success of precious metals- backed products that hold assets valued at about $122.1 billion, according to data compiled by Bloomberg. ETF Securities Ltd. offers products backed by industrial metals including copper and aluminum.
To contact the reporter on this story: Nicholas Larkin in London at nlarkin1@bloomberg.net
To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net
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