Industrial Uses of Precious Metals
Precious metals are widely seen as a great asset to diversify any portfolio. Many precious metal products are well-crafted, beautiful, detailed, and unique, making them sought after by investors and collectors alike. Along with investing/collecting, precious metals are used substantially in the jewelry industry, but they also have other important industrial uses. Due to their unique qualities, precious metals are able to benefit many industries in ways that no other metal group can. These industrial factors can demand large amounts of the metals, leading to a lower supply for the investment industry and higher prices.
Gold has many different applications in numerous industries. Although more than 75% of newly mined gold is used in jewelry, other industries demand gold to be a key aspect of their products. Gold is a great electrical conductor, which is why almost all modern smartphones and computers have some amount of gold in them. Gold also has the ability to remain corrosion-free, leading to a long-lasting and efficient conductor. Gold also has a rare ability to reflect sunlight in a specific way, which has led companies in the space industry to adopt the metal to protect from ultraviolet radiation.
Silver’s use in industrial practices is continuing to expand, as it is a key component in many green technologies. Silver’s unique properties make it a must-needed component. Like gold, silver has high electrical conductivity, making it essential in many electronics. Silver is known as the best metal for thermal and electrical conductivity as well as being a great reflector of light. This has led silver to be widely used in the solar panel industry when in 2019, it accounted for over 10% of the entire silver demand. Traditional photography, film, and X-rays also account for a large amount of silver demand, however, with digital media expanding, this sector is decreasing. Silver also has antimicrobial properties, which has made it popular with medical devices and pharmaceuticals to prevent the spread of pathogens. For all of these reasons, silver is used in industrial processes more than any other precious metal.
Platinum has many industrial uses that account for the majority of its demand. The main industry that demands platinum is the automotive industry. Approximately half of the yearly demand for platinum goes to the automotive industry, which uses the metal in catalytic converters to reduce the harmful emissions produced by cars. Platinum is also used as a chemical catalyst and in many medical products. Investment in platinum accounts for around 15% of its demand.
The fourth primary precious metal, palladium, is also predominantly used in industrial applications. Up to 90% of the yearly demand for palladium goes to the automotive industry as an alternative to platinum in catalytic converters. Platinum and Palladium are both part of the platinum group metals and therefore share some qualities. Palladium is also used in hydrogen fuel cells, electronics, and dentistry.