Palladium futures have settled at a 17-month high, while platinum marched higher, as traders continue to sift through reports of a potential supply disruption in Zimbabwe.
Palladium for March delivery, the most active contract, on Wednesday rose 65 US cents, or 0.1 per cent, to settle at $US772.05 a troy ounce on the New York Mercantile Exchange. This was the highest settlement price since September 2011.
The most actively traded platinum contract, for April delivery, rose $US12.50, or 0.7 per cent, to settle at $US1,729.70 a troy ounce on the Nymex. This is the highest settlement price since February 6, when platinum touched its 2013 high of $US1,736.50 a troy ounce.
Prices of both platinum group metals, or PGMs, continued to draw strength from news that the Zimbabwean government will seize nearly 28 hectares of land leased by platinum miner Zimplats Holdings Ltd.
The measures are aimed at re-allocating assets to local businesses, but some analysts say the moves could disrupt production of platinum group metals, or PGMs, which includes platinum, palladium and rhodium.
"While PGM production from Zimbabwe pales in comparison to South Africa, it nonetheless reflects the tensions PGM miners face operating in the Southern African region," said James Steel, precious-metals analyst with HSBC. He added that prices of platinum and palladium were likely to move higher as a result.
Platinum and palladium prices have soared more than 10 per cent so far this year, amid fears that mine closures in top supplier South Africa will lead to a shortage.
Platinum and palladium are mostly used to make car exhaust filters, known as catalytic converters.
Zimbabwe's platinum output puts it in third place, behind world leader South Africa, and second-place Russia according to Johnson Matthey, a specialty chemicals company which makes platinum and palladium coatings for the auto industry.
Meanwhile, gold futures retreated as the euro lost its footing against the US dollar, and nudged gold traders toward the exit. The euro slipped to $US1.3453 in afternoon trade, after touching highs of $US1.3520 earlier in the day.
Dollar-denominated gold becomes more expensive to European buyers when the euro weakens against the dollar, pushing them to sell the metal.
The most actively traded contract, for April delivery, fell $US4.50, or 0.3 per cent, to settle at $US1,645.10 a troy ounce on the Comex division of the New York Mercantile Exchange.