By: CPG

The global precious metals market has been quietly transformed by rhodium, a chemical element that has become the most valuable substance on Earth. Extremely rare and indispensable for automotive catalysts, its price has reached historic highs, peaking at over $25,000 per troy ounce.

Rhodium's immense value stems from its scarcity and critical industrial application. It is 100 times rarer than gold, with global production amounting to only a few tens of tons annually. The metal is not mined directly but is a byproduct of platinum and palladium extraction, primarily from South Africa's Bushveld geological belt. Mining occurs at depths exceeding 3 kilometers, where temperatures soar above 50°C, and processing 100 tons of raw ore may yield just one gram of rhodium.

The primary driver of demand is its irreplaceable role in reducing nitrogen oxide (NOx) emissions in gasoline-powered vehicles. Stricter environmental regulations worldwide have made its unique catalytic efficiency more crucial than ever. This creates a paradox: while the long-term shift to electric vehicles may reduce demand, the short-term need for cleaner internal combustion engines keeps prices high.

South Africa's dominance, accounting for over 80% of global supply, makes the market vulnerable to operational and political disruptions within the country. The complex, billion-dollar refining process and the metal's enduring importance in other industrial sectors, from chemical production to optical equipment, ensure that rhodium will remain a strategically vital and exceptionally valuable metal for the foreseeable future.