Why Platinum


Platinum is both a monetary and an industrial metal.  Platinum is used in jewelry, laboratory equipment, electrical contacts, dentistry, and automobile emissions control devices.  It is increasingly being used as a catalyst in fuel cells and is a major focus of fuel cell research.  The price of platinum changes along with its availability, historically it had been normally more than twice the price of gold however that is not the case any longer.  

Platinum is one of the most precious metals known to man.  More precious than silver, rarer than gold, platinum's preciousness and relative rarity compelled King Louis XV of 18th century France to declare it the only metal fit for a king.  Hundreds of years later, platinum is still considered to be the most exclusive of all jewelry metals.

Platinum is an extremely rare metal, occurring at only 0.003 parts per billion in the Earth's crust, and is 30 times rarer than Gold.  The mining of platinum is a difficult, time-intensive process.  Platinum is, therefore, more expensive to mine than other precious metals.  Ten tons of ore must be mined and processed to yield one single ounce of finished platinum.  If all the world's platinum reserves were poured into one Olympic-size swimming pool, it would be just deep enough to cover one's ankles. 

New mine production totals approximately 5 million troy ounces a year.  In contrast, Gold mine production runs approximately 82 million ounces a year, and Silver production is approximately 547 million ounces.  As such, Platinum tends to trade at a higher price.  Platinum price peaked near $2,300 per troy ounce in March 2008 driven by production concerns brought about by problems at South African mines. It is found in very few places throughout the world, mostly in South Africa.  South Africa is the top producer of Platinum with an almost 80% share followed by Russia and Canada, hence, Platinum often incurs higher transportation costs. 

When the price of oil, electricity, and other commodities required in the mining of platinum increase, and so does the price of new platinum.  That results in a greater demand for used platinum and platinum scrap in the precious metals market, a demand that creates higher profit margins for those who are interested in selling their platinum.

Due to the extreme rarity of Platinum and fast-growing demand, it may be a good investment opportunity.  With Platinum being increasingly incorporated into such technologies as fuel-cells tho drive the cars of the future, and converters to clean the air; it could be in growing demand for the new "green" technologies for years to come. 



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