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Often considered more precious than gold, platinum is a rare and fascinating metal. Its resistance to most corrosive elements has made it an ideal choice for several industrial (as well as decorative) applications, but its apparent rarity of occurrence in the Earth's crust has also made for a volatile market.

This precious metal is one of six metallic elements collectively known as platinum group metals (PGM). The other five members of PGM include ruthenium, rhodium, palladium, osmium, and iridium.

Soil and sediment deposits - otherwise known as alluvial deposits - have proven to be a significant source of platinum, but it can also be found as a byproduct of nickel mining. Approximately eight tons of ore must be mined to produce one pure ounce of platinum. The refining process can be an intensive mix of mining, crushing, milling, mixing, melting, and smelting - this process can take up to eight weeks.

The process is illustrated as follows:

***data courtesy the United Nations Conference on Trade and Development

The largest production of platinum occurs in South Africa, followed by Russia. Platinum can also be recovered from scrap and recycled.

***data courtesy the United Nations Conference on Trade and Development

Availability: By far, the most significant area of focus for platinum is its low occurrence in the Earth's crust. The rarity of platinum compared to other metals has spawned a number of creative attempts to illustrate just how scarce the metal may be, i.e. imagining that all the platinum mined would fit in an average swimming pool or living room.

Regional Concentration: In addition to its apparently limited supply, a huge percentage of current mining is also confined primarily to South Africa and Russia leaving the door open for the possibility that any political concerns or regional unrest could disrupt supplies. An excellent example of this possibility was illustrated by the concern over limited electricity supply to mining companies in South Africa and the likelihood that refining and production would be interrupted - an event which contributed significant volatility to the market.

Applications: New applications, as well as an increase in the existing technologies which employ platinum, could shift the supply and demand dynamics rather quickly. The continued efforts to control emissions are significant in that platinum plays an important role in catalytic converters - however, new technologies have enabled the automotive catalyst creators to substitute other PGM metals, something which may impact the overall percentage use of platinum.

Economic Conditions: Since the largest demand for platinum currently comes from the automotive sector, economic issues which may impact automobile sales may also impact platinum prices.