Stefan Gleason Blog | Major Optimism For Platinum, Silver, And Copper | Talkmarkets
President at Money Metals Exchange
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Gleason is president of Money Metals Exchange, a national precious metals investment company and news service with over 450,000 readers, 35,000 paid customers, and $120 million in annual sales. He launched the company while president of a national newsletter publishing ... more

Major Optimism For Platinum, Silver, And Copper

Date: Friday, February 12, 2021 6:42 PM EDT

By Mike Gleason, Money Metals Exchange

 

Attention in the metals markets shifted this week from silver to copper and platinum. While big moves in silver and gold prices may be coming down the road, the monetary metals are currently taking a back seat to electrical and automotive metals.

 

A massive push by the Biden administration to replace gasoline vehicles with electric vehicles is helping to crank up demand for copper. Anything involving electricity involves copper – and lots of it.

 

Electric vehicles and their massive batteries contain an average of 180 pounds of the metal.  That’s six times the copper that’s used in gasoline cars. Even larger quantities of copper are required for EV charging stations and necessary upgrades to electrical grid infrastructure.

 

Electric vehicles sales are expected to grow from 4% of the market to 10% by 2022. And if the “Zero Emission” lobby gets its way, EVs will be 100% of the car market by 2030 with a federal prohibition on gasoline vehicles.

 

Regardless of concerns about personal freedoms being trampled in the process, it may simply not be feasible to power tens of millions of new electric cars without enormous upgrades to electricity generating capacity.

 

That will require enormous quantities of industrial materials, including copper. And the red metal isn’t likely to come any cheaper in the years ahead.

 

 

In particular, platinum is on the move. Concerns over a mining supply deficit and the prospect of renewed demand from automakers and jewelers are helping to send platinum prices more than 13% higher this week.

 

As long as platinum continues to trade at a discount to gold, it will look relatively attractive to investors and jewelry buyers.

 

And as long as platinum continues to be available at a much cheaper price than palladium and rhodium, it will be sought by automakers who are looking to lower their catalytic converter costs through substitution. 

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