- Rhodium is a precious, highly reflective, corrosion resistant metal, primarily mined as a by-product of palladium, platinum, or nickel mining.
- The metal finds application in automotive catalytic converters to reduce toxic gas emissions.
- The demand for rhodium is soaring amid the rising stringent emission norms.
- South Africa is the world’s leading producer of rhodium, accounting for more than 80% of the total supply.
Rhodium, one of the six platinum group metals, is considered the rarest and most valuable precious metal. The silver-white metallic metal is highly reflective and corrosion resistant. Its atomic number is 45 and atomic weight is 102.90550.
In the recent past, the demand for rhodium soared significantly, pushing its prices to all-time highs in March this year.
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Rhodium, which occurs up to one part per 200 million in the Earth's crust is the rarest among all platinum group metals including platinum, palladium, rhodium, osmium, iridium, and ruthenium.
As a noble metal, rhodium has outstanding resistance to oxidation, even at high temperatures. Other unique properties of this platinum group member are high melting point, general non-toxicity, and resistance to wear and corrosion.
What are the uses of rhodium?
Rhodium is extensively used in catalytic converters in car exhaust systems. A catalytic converter is a vehicle emissions control device used for the conversion of toxic by-products of combustion to substances that are less toxic.
Rhodium, generally along with platinum or palladium, lowers the discharge of nitrogen oxide in the atmosphere, thus aiding in curbing emissions.
It is a very special metal owing to its performance in nitrogen oxide conversion into harmless gases. Its demand is soaring amid growing use in the automotive industry to meet the rising stringent emission norms.
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Other applications of rhodium include jewellery, mirrors, and searchlights. The metal is also used in the manufacturing of turbine engines for aircraft.
In the chemical industry, it is used as a catalyst to produce nitric acid and acetic acid, as well as in hydrogenation reactions. The metal is also used for coating optic fibres and optical mirrors.
The silver-white metal is sometimes alloyed with iridium and platinum to produce an oxidation-resistant material that can bear high temperature and is often used in the manufacturing of resistance wires, electrodes, spark plugs, phonograph needles, etc.
How is rhodium mined?
Rhodium content in the Earth’s crust is extremely rare. Thus, the metal is usually sourced as a by-product of nickel and platinum mining.
Naturally, rhodium can be found in association with other platinum minerals.
Most of the rhodium production is concentrated in the vicinity of the Bushveld Complex in South Africa. The metal is also found in copper-nickel sulfide ores of Canada and in river sands of North America and South America.
The primary step in rhodium extraction is the precipitation of precious metals like gold, palladium, platinum, and silver. The remaining ore is then treated with sodium bisulfate and melted, which gives rhodium sulfate. It is then dissolved in hydrochloric acid and heated until the residual contaminants are burned off, leaving pure rhodium.
Rhodium demand and price movement
South Africa is the largest producer of rhodium in the world, accounting for more than 80% of the total supply. Russia is the second largest producer, with annual rhodium production of 65-68koz.
Since 2019, the demand for rhodium has been skyrocketing with the prices increasing from US$2,500 per ounce to nearly US$19,250 per ounce in June 2021.
The prices of rhodium have surged more than 140% since the beginning of the year till June 2021. In March 2021, the prices gained 170% when compared with the prices in January 2021.
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The supply disruption caused by the COVID-19 induced challenges has created a supply crunch of the metal. The imbalance in the supply and demand has disturbed the market equilibrium and buoyed the metal prices to record high levels.
Though COVID-19 led disruptions impacted its demand to 6,67,000 ounces in 2020, the demand is expected to surpass the 2019 level of 7,98,000 ounces in the current year. Higher demand and supply disruptions in South African mines are expected to keep the rhodium prices firm in the near future.