Entire Annual Report - Anglo American Platinum

Gross palladium demand for the autocatalyst sector declined by an estimated 12% in 2000 as some auto manufacturersdrew on stocks built up in previous years. This is misleading, however, as actual usage of palladium in catalysts is estimated tohave been about 20% more than in the previous year. The introduction of Euro stage III legislation in Europe from thebeginning of 2000 boosted demand for palladium by nearly 20%, while automobile companies in North America needed450 000 ounces more as a higher proportion of vehicles manufactured in the year had to comply with LEV legislation.Many automobile companies, especially those in North America which have been heavily palladium-dependent, haveannounced that they will be reducing their reliance on palladium in the future. However, although increasing theirplatinum and rhodium content will aid the reduction of palladium in autocatalyst systems, palladium must be, and willcontinue to be, heavily used in order to comply with the more stringent hydrocarbon standards.An estimated 50% growth in the production of multi-layer ceramic capacitors (MLCC) in 2000 resulted in an increase indemand for palladium in the electronic industry. Many electronic companies built base metal MLCC plants in 1999 whenthe strengthening palladium price started to reduce their profitability. However, the massive demand for thesecomponents could not be met by base metal capacity alone, and palladium purchases for the electronic industry areestimated to have increased by 5% to 2,07 million ounces in 2000.The dental industry’s consumption of palladium is estimated to havedeclined by 22% to 870 000 ounces in 2000.The price of palladium, especially incomparison with that of gold,resulted in a marked shift towardsbase metal and gold-based dental alloys.Consumption of palladium in other applications, whichinclude jewellery and chemical applications, registered a small declinein 2000. Palladium is added to platinum for jewellery alloys,but with the higher prices for palladium in 2000 itbecame worthwhile to increase the amount of43