Russian platinum and palladium that had just been processed were barred from dealing in London as of Friday, the latest in a growing list of sanctions against Russian interests as a result of the Ukraine war.
Palladium prices jumped as much as 11 percent, with traders worrying the move will exacerbate a palladium scarcity in exhaust pipes used by automobiles to reduce pollution.
Norilsk Nickel (Nornickel) of Russia produces 25-30 percent of the world’s palladium and about 10 percent of the world’s platinum, both of which are used to reduce automobile emissions as well as in other industries and jewellery.
At 1600 GMT, platinum prices were up about 1 percent, while palladium prices were up 8 percent.
The London Platinum and Palladium Market, a trade group, said the situation in Ukraine caused it to reassess its list of ‘good delivery’ refiners authorised to deliver metal into the London trading market.
The LPPM said that both Russian refiners on its list, JSC Krastsvetmet and the Prioksky Plant of Non-Ferrous Metals, would be suspended with immediate effect.
According to the LPPM, the suspension prevents platinum and palladium produced by these refiners after April 8 from dealing in London, however items made while accredited are still allowed to trade.
The decision comes a month after the London Bullion Market Association (LBMA) halted certification of Russian refiners, thereby barring new Russian gold and silver from entering the London market.
Nornickel did not respond to a request for comment.
According to the company’s website, it refines metals at Krastsvetmet, Prioksky, and Uralintech refineries.
According to a source close to Nornickel, the LPPM ruling will limit its ability to sell to banks, but sales to manufacturers, which make up the majority of the company’s revenue, will be unaffected.
However, industry insiders in London say the decision will put more pressure on manufacturers to reject Russian platinum and palladium.
Any boycott of Russian material will assist recyclers and miners in South Africa and North America, the other major producers.
The LPPM statement made no obvious relation between its decision with the growing number of sanctions imposed by Western governments against Russia since Russia’s incursion, which Moscow calls as a ‘special military operation.’
The European Union approved its fifth set of sanctions on Friday, including import bans on coal, wood, chemicals, and other goods. find out more
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