Palladium ETF Reaching 3-Year High on Sanctions Against Russia | ETF Trends

With the threat of additional sanctions against Russia, palladium prices and related exchange traded funds strengthened to their highest levels since 2011.

The ETFS Physical Palladium Shares (NYSEArca: PALL) was up 2.1% Friday, hovering around $78.6 per share, its highest level since late early August 2011. PALL is up 10.5% year-to-date.

Palladium futures were up 2.0%, trading around $806.2 per ounce.

As tensions between Ukraine and Russia escalate, Treasury Secretary Jacob J. Lew stated that the U.S. is ready to impose “significant” measures against Russia, the world’s largest supplier of palladium, if the country foments unrest, reports Luzi Ann Javier for Bloomberg. [Fundamentals Support Palladium, Platinum ETFs]

U.S. Secretary of State John Kerry has said that sanctions targeting Russia’s energy, banking and mining industries are “all on the table.”

The uncertain outlook on Russia supplies has put additional pressure on palladium prices, with mine strikes in South Africa, the second-largest producer, cutting down on supply and increasing auto sales bolstering demand.

“We’re seeing real robust increases in auto sales in major markets, especially gasoline car sales in the U.S. and China,” Mu Li, senior commodity analyst at CPM Group, said in a CNBC report.