Depreciation of US currency is leaving clear traces (Newsletter Nr. 67)


The weakening US Dollar is increasingly impacting the international markets for raw materials. All metals are usually dealt in US Dollar. But the depreciation of the American currency these days has become a burden for producers in countries like South Africa and China. As a consequence prices in USD have recently increased for most of the Platinum Group Metals, but also for Technology Metals and Rare Earths.

Germanium at a 2-Year High

For Germanium it is not only the weakness of the US Dollar, but also supply shortages driving prices up. In China for instance a number of melting furnaces was shut down because environmental requirements have not been fulfilled. Apart from this there have been some major technical problems at the Canadian Teck Resources who is one of the world’s biggest producers for germanium. This whole situation leaves a lot of potential for a further increase of the germanium prices.

Indium and Gallium also showing some positive trend

Apart from the depreciating value of the USD an increasingly interest of investors has led to higher prices for the electronic metals gallium and indium. In the meantime both metals have reached a new 3-Year High! Current supply shortages have also contributed to the actual price development. This is mainly caused by environmental measures that have been imposed by the Chinese Government. While the forthcoming Chinese New Year will lead to a 2-week stand still of Chinese factories there is no easing of the current price level to be expected.

Same effects on Rare Earths

After a significant downturn of prices towards the end of last year most of the rare earth elements have seen some turnaround in recent weeks. The reasons are indeed very similar: supply shortages accompanied by the weakening US dollar! It is expected that the forthcoming Chinese New Year starting mid of February will particularly keep export prices at higher levels. Consumers who delay covering their short-term demands might end up in supply bottlenecks.