Platinum Prices in 2017 Could Climb Thanks to One Booming Industry

platinum prices in 2017 Platinum prices in 2017 have been volatile, trading as low as $914.40 per ounce and as high as $1,022.60 per ounce. That’s an almost 12% swing in just two months.

The platinum price per ounce right now sits at $1,018.50. While that’s down 13% from its high point of $1,180.90 on Aug. 10, 2016, it’s up 13% from its low point of $894 on Dec. 26, 2016.

And we think that is just the start of the gains this year.

You see, one booming industry relies heavily on platinum to make its products.

We’ll talk more about that industry in just a bit.

But first, we want to make sure Money Morning readers know two other major factors that will move platinum prices in 2017…

3 Factors That Will Move Platinum Prices in 2017

According to Money Morning Resource Specialist Peter Krauth, 35% of platinum use is in jewelry.

Well-known jewelry stores like Jared carry platinum wedding bands, while Zales carries diamond solitaire pendants in platinum that cost upwards of $14,000.

And because platinum prices can rise and fall based on industrial demand, Krauth says prices can be at the mercy of the jewelry market.

So if gold or silver becomes more popular for jewelry makers, the demand and prices for platinum can fall.

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The other reason platinum prices can fall is the strength of the U.S. dollar.

Because platinum is priced in U.S. dollars, a stronger U.S. dollar means it’s more expensive for foreign investors to purchase platinum. And when the U.S. dollar is weaker, it’s less expensive to purchase platinum.

But there’s also a third reason why platinum prices can climb or fall…

In fact, 43% of consumed platinum is used in this one industry, which is the largest industrial use of the precious metal.

And because of sales in this industry, here’s why platinum prices could start climbing even higher…

The Biggest Reason Platinum Prices Could Climb in 2017

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In a vehicle, a catalytic converter is used to convert toxic gas and pollutants to less toxic pollutants.

And according to SpecialityMetals.com, there are between three and seven grams of platinum group metals in standard catalytic converters.

Krauth told me as much as 43% of consumed platinum goes into auto catalysts, which makes carmakers the largest industrial users of platinum.

Now, it’s true that some cars with mostly gasoline engines require more palladium. But Krauth told me in countries with more diesel engines, like in Europe, more platinum catalysts are required.

And in 2017, auto sales in Western Europe are expected to climb…

According to IHS Markit, sales in Western Europe are expected to climb 1% in 2017 from 2016 totals of just under 14 million. The estimate is conservative because of Brexit and elections in France and Germany.

But that’s good news, as even conservative projections still expect auto sales to climb.

And if auto sales exceed expectations, platinum prices can climb even higher due to the increased industrial demand.

The Bottom Line: Platinum prices in 2017 will rise and fall based on the strength of the U.S. dollar, demand from jewelry makers, and demand from the auto industry. And with vehicle sales continuing to climb, platinum prices could start climbing higher.

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