LONDON (Commodity Online): Riding on the rise in prices, palladium mining companies posted huge profits in the third quarter.

Stillwater Mining Company reported a net profit for the 2010 third quarter of $5.9 million on revenues of $142.9 million. This compares to third quarter of 2009 net income of $4.2 million on revenues of $112.0 million.

Stronger realized PGM prices in the third quarter of 2010 more than offset lower sales volumes in the third quarter of 2010 as compared to the third quarter of 2009. For the first nine months of 2010, Stillwater Mining Company reported net income of $33.8 million, or $0.34 per fully diluted share, on revenues of $411.2 million. In the first nine months of 2009, the company reported a net loss of $2.9 million, or $0.03 per diluted share, on revenues of $292.6 million.

Another palladium producer, Sylvania Resources, saw the PGM production increase by almost a third during the first quarter of its 2011 financial year.

The company announced that output totalled a record 8,758 oz, representing a 32 per cent rise from the previous three-month period. Sylvania had initially predicted that it would produce 8,000 oz, but the final figure was boosted by an extra 137 oz of PGMs being received following refinery corrections.

The impressive performance is also being attributed to operations commencing at the R97 million Doornbosch PGM and chrome recovery plant, plus ongoing improvements at the firm's other four plants.

Sylvania is now targeting PGM production of 40,000 oz for the full financial year to the end of June 2011.
Palladium’s price point has risen nearly 50 percent during 2010, nearly twice that for gold and three times that for platinum, palladium’s chemical cousin.

Price’s for palladium are reaching their highs for the decade, and these levels would be a record had not the market been distorted back at the turn of the millennium.

The two largest producers of palladium, Russia and South Africa, account for roughly 45 percent of the market apiece, with Canada and the United States splitting the remaining 10 percent.

Approximately half of this production is used in making catalytic converters for the global automobile industry, and Ford Motor Company, fearing a shortage brought on by ongoing political instability, stockpiled the metal at market-panicked prices, as noted by the severe spike in 2000. When tensions subsided, Ford recorded a financial loss of over $1 billion after prices plummeted back to reality.

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