Norilsk Nickel started operation of Palladium Fund

16 May 2016

MMC Norilsk Nickel started operation of palladium fund in test mode, informed the Company's Vice President of Strategic Planning Sergey Dubovitsky. “Palladium Fund is created; it began to function in small volumes. Our goal, which we have always declared, is a fund as a market balancing tool, and now we are trying its role in test mode... We have no hard purchase targets for this”, told Dubovitsky, adding that so far it comes to several tons only. Dubovitsky stressed that the characteristics of the fund's strategy lies in the fact that the Fund does not take risk positions, that is, does not hold the metal, but hedges and resells it to industrial customers. In this case, the main task of the fund is to reduce volatility, including through the binding of free metal and selling it directly to industrial customers. Earlier this year, Norilsk Nickel has taken a decision to create a Global Palladium Fund L.P., investment fund with a limit of financing by the Company of up to USD 200 mln. It was noted that the purpose of the fund is to create a financial instrument for working with large holders of palladium stocks, the development of industrial demand for the metal, reducing the overall volatility of palladium market.The Company’s CEO Vladimir Potanin reported in March that Norilsk Nickel continues talks with the Bank of Russia on the purchase of palladium from the State Fund. At the same time the Company itself does not make savings in the Palladium Fund.

Source: RIA News