When we think of precious metals, many of us will only think of Gold and Silver. Yet Bleyer stock other precious metals as well, including Platinum, Palladium and Rhodium. Today, we’re going to focus on the rarest of them all, Rhodium.
While Gold and Silver have attracted the attention of some investors of late, there is a metal that is far, far rarer with fundamentals that merit serious investment consideration. Discovered along with palladium by British chemist and physicist William Wollaston in 1803, Rhodium belongs to the platinum group metals (PGM) together with platinum and palladium.
1. 30 Years of Price Moves
To analyse a metal's investment potential, it's always important to look at how it has performed in markets, most importantly in this case, over the past 30 years. Historically, rhodium reached an all-time high in June 2008 and a record low in January of 1997. The below price (USD) chart demonstrates the peaks and troughs of this precious metal since the early nighties:
2. Recent Price Shifts
In the past three years, rhodium's bullish trend can be clearly seen. With each gain, we can see a slight market pullback, before another gain is made. The increase in price has been dramatic over the past 3 years. From August 2016, to April 2019, rhodium saw a price increase of a whopping 193.92%. If you've got a short-investment strategy, pay attention to market forces, buy on lows and sell when markets reach their peaks. The below price (GBP) chart shows rhodium's moves from the past 3 years:
Source: Market Insider
3. What is Rhodium?
Symbolised as Rh in the periodic table, and as a chemical element that occurs naturally, rhodium is never found as a chemical compound but as a metal alloy with other similar metals. It is a rare, silvery-white, hard, corrosion-resistant, and chemically inert transition metal.
Technically rhodium is a metal, but it’s not like gold, platinum and palladium at all. It’s remarkably brittle, making it difficult to turn into a coin or ingot. If you put a gold coin in a vice, you could bend it. A rhodium coin will just snap in half. That doesn’t mean it’s fragile. It just means it’s more glass-like than gold-like, which makes it cumbersome to trade.
Did you know - Rhodium is the world’s most expensive traded precious metal costing double that of Gold?
The term 'bullion' only applies to gold and silver. Platinum, palladium and rhodium are actually referred to as 'Platinum Group Metals' or PGMs. The PGM group even includes other much lesser known sister metals, such as ruthenium and iridium as well. Generally, it is the top four metals (Gold, Silver, Platinum and Palladium) that are used the most frequently as a store of investment by private investors, governments and central banks.
4. Geo-Political & Mining Influences
The most obvious fundamental of this PGM is its supply. You won’t find many companies that specialize in rhodium mining because its a bi-product of mining other similar metals. Nearly 80% is mined in South Africa and 14% of the world’s supply comes from Russia. This niche supply has a big impact on world markets. For example, in 2001 Russia stops its Palladium shipments, which caused the price to escalate. As recently as 2009, Russia also used its gas supply as trading leverage.
South Africa also has its own political issues, from miner’s strikes, to government cuts in electricity supply which interfere regularly with mining output. Pay attention to market news in these areas. It doesn’t take much imagination to see the ease in which tightening on the supply of Rhodium will increase its price.
5. Uses of Rhodium
You may have heard the term 'Rhodium Plated'. This refers to electroplating, particularly on jewellry, to provide a surface that will resist scratches and tarnish, and give a white, reflective appearance. Rhodium plating is most often found on white gold and silver jewellery to give them a brilliant shine.
Rhodium is hard and durable with a slight reflective quality. It's also known as a noble metal because it is both corrosion and oxidation resistant. In industry application, it is also frequently used as an alloy for palladium and platinum in aircraft spark plugs, as well as in electrodes, furnace coils and catalytic converters in cars.
Rhodium is extremely rare for investment but offers big rewards with careful timing. Bleyer is unique in that we offer the only commercially produced range of 999.5 purity Rhodium investment bars. For a more substantial, yet equally compact, investment, we also offer the 5oz Rhodium bar. Buyers should be aware that because the market for rhodium is extremely thin, the premiums are higher. The metal is also subject to VAT.
So, call now to explore your current investment opportunities in the rarest precious metal of them all, rhodium. As always, we recommend our clients conduct their own thorough and additional research. Contact one of the team via 01769 618618 or [email protected].