Those of us not in the metals industry have most likely heard of rhodium due to one of the following facts:
Queen Elizabeth’s Crown Jewels are rhodium-plated, Sir Paul McCartney received a rhodium record disc for being the best-selling recording artist of all time, and Barack Obama purportedly asked Giovanni Bosco to custom-make a rhodium ring for his wife Michelle as a thank-you gift after the 2008 election.
When it comes to wedding bands, is rhodium the most beautiful? No. Actually, it’s rather ugly as far as aesthetics are concerned. Its naturally occurring dark gray powder translates into dark gray bands. Is it easy for a jeweler to work with? Definitely not. With a higher melting point than platinum, it’s a terrific pain to cast. But is it rare? You bet. And analysts are predicting its market value to go nowhere but up.
With annual production standing at no more than 25 tons, logically rhodium will be pricey. There have been fluctuations over the past decade, but many factors go into how important rhodium is for the metals industry. Roughly 90 percent of rhodium demand is driven by the auto sector. Tightness is a key consideration on the supply side, with only South Africa and Russia producing the metal. Any shortages or interruptions there could lead to spikes. Most importantly, with Chinese, Indian and Brazilian consumers ever hungrier for cars, the demand will follow suit. China saw a 27 percent increase in wholesale vehicle deliveries from a year earlier, up to 1.2 million, according to the China Association of Automobile Manufacturers, while total national vehicle sales rose 25 percent.
Average prices per ounce in the United States, according to the US Geological Survey’s 2010 Mineral Commodity Summaries, ranged from $530.28 in 2003 to $2,059.73 in 2005, hitting $6,533.57 three years later and settling back in 2009 to an estimated $1,468.
Metals Week reported that on a weekly average basis, prices rose to $10,100 an ounce on June 19, 2008. Currently, the price toggles in the mid-$2,000s an ounce.
CPM Group’s 2010 PGM Market Outlook expects rhodium to reach historically high prices over the next 10 years. In addition to increased demand and constrained supplies, rising investment demand is clear. Kitco is even pushing physically packaged rhodium sponge kits, with their current bid price at $2,600.
So, what if I want to invest in a pure rhodium wedding band? It would ultimately be a tough sell (and with my personal budget, an even tougher buy). Most custom jewelers in the U.S. are loath to work with rhodium.
“I’ve never seen the metal, said Jim Tuttle, owner of Green Lake Jewelry Works. “I’ve never even held it in my hand. Folks like Tuttle have virtually no need to procure the physical metal. Generally, rhodium is only used for “plating other wedding band metals, such as white gold and even then, the metal is held in chemical suspension with an electric current run through to bind rhodium ions to the ring. The main benefit: giving it a brighter shine.
However, there are jewelers who use rhodium alloys in their rings. Neil Garnett, a jeweler from London, made two wedding bands of solid rhodium mixed with 20 percent platinum. “You have to add 20% Plat as Rhodium will break if used in its pure form, he writes in a finishing industry blog forum. But online vendors don’t hesitate to advertise rhodium wedding bands. American Elements, a Los Angeles-based manufacturer, features up to 99.999 percent pure rhodium rings.
As a bit of fun, let’s assume there are 10 grams of pure rhodium in a man’s wedding band. At roughly 0.032 ounces to one gram, the ring carries 0.32 ounces of the metal. The market value of the band would stand at $800. Compared to the same amount of platinum in a band (again, assuming the specific gravities are equal, which they’re not), the rhodium ring is roughly 33 percent more valuable. And, because rhodium is so hard to work with, the retail price would likely reach much higher.