The Price / Value of Platinum

Platinum is the one of the rarest precious metals in the world. One of the strongest metals known to man, platinum is so scarce it is more valuable than other precious metals, including gold, in today’s market. As of this writing, the current platinum price is set at more than $1500 per troy ounce, higher than the $1100 per troy ounce that gold fetches.

Economic supply and demand factors determine the price of platinum. Platinum price also depends on the state of the economy. It is considerably higher, by as much as twice the price of gold, during times of sustained economic stability and growth. Conversely, economic uncertainty can spur a decrease in platinum value, sometimes to the point where it can become less expensive than gold.

The London Platinum & Palladium Market (LPPM) or the “London Fix” serves as the reference price for platinum. It is usually considered the international benchmark for the price of platinum.

At present, platinum is one of the most in demand precious metals in the world. The scarceness of the metal alone, which stands at a limited supply of around 7 million ounces a year, contributes greatly to its high value. Platinum, which is so heavy a six inch square block would roughly be the same weight as an average sized man, is hard to produce, requiring eight to ten tons of ore to be mined to produce just one pure ounce of the precious metal. Then there is the fact that about ninety percent of the world’s platinum come from South Africa, the world’s largest producer of platinum, and Russia, the second largest producer of platinum. The cost of importing the metal from these countries also influences current platinum value. No wonder platinum recycling is often resorted to by many platinum jewelry makers.

Platinum possesses a shine and inertness that makes it a popular metal for jewelry, as it doesn’t tarnish or wear out. Jewelers use it for rings and other jewelry usually as an alloy or blended with other metals. Major watchmakers also use platinum for their limited edition watches.

Much of the demand for platinum, however, comes from the industrial sector. An incredibly tough yet flexible metal, platinum is proving to be a very essential material in industry. Currently, platinum is used in electrical contacts and electrodes, platinum resistance thermometers, neurosurgical and dentistry equipment, sophisticated batteries and fuel cells, gun parts, laboratory equipment and catalytic converters. Consumer electronic products such as iPods, computer and television screens, and computer hard disks, also make use of platinum.