China’s imports of Russian palladium fell 70% year on year to 1.56 tonnes in September, Kommersant reported on November 5, a blow to metals major Norilsk Nickel (Nornickel, MOEX: GMKN).
The shipments, covering unwrought palladium, powder, plates and sheets, were worth $77.7mn, down 67% y/y and about 30% below August in volume, according to Chinese customs data cited by the paper. China’s total imports of unwrought palladium halved to 2.9 tonnes, which Shanghai Metals Market put down to lower world prices and stocks built earlier. The nine-month picture still looks strong, with China buying 25.9 tonnes from Russia, up 45% y/y, for $1.5bn, more than double a year earlier.
Those 25.9 tonnes come to about 833,000 ounces, equivalent to 43% of the 1.93mn ounces Nornickel produced in the first nine months. Russian exports may include other producers and stocks, so this comparison does not establish that China buys a large share of Nornickel’s output. The surge followed the closing of the US market: market participants told Kommersant in February that Russia appeared to have stopped shipping to the US from August 2025, during an anti-dumping case. Washington imposed no duty in the end, after the International Trade Commission ruled against one in May, but China’s restocking now looks to be slowing while the car industry, which takes more than 80% of the metal, builds fewer of the engines that use it.
S&P forecasts world car output falling 3% to 91.7mn in 2026, with combustion engine models, the ones that need palladium catalysts, down 7% to 74.2mn and a further 5% to 70.4mn in 2027, the paper reported. That is about 9mn fewer such cars a year in two years. Nornickel, the largest producer with about 40% of the market, itself says demand prospects are worsening as combustion engine output falls.
Spot palladium fell to $935 an ounce on November 3, its lowest since May 2025, before recovering to about $1,040 by November 5, according to Bloomberg data, after topping $2,000 in January. Swiss bank UBS (SIX: UBSG) cut its 12-month forecast by $100-$200 to $1,100 an ounce in October, and BCS says the metal has lost about 20% in a month. The customs numbers work out at about $1,550 an ounce for September and about $1,800 for the nine months, so the latest slide has yet to show up in China’s import bill.
Palladium accounted for 23% of Nornickel’s revenue at the end of 2025, level with nickel and behind copper at about 32%, on Alfa-Capital estimates. The current correction could cut revenue by 5-8% and EBITDA by 7-10%, said Maxim Shaposhnikov, adviser to the manager of the Industrial Code fund. That would come off a strong year so far, with 1H26 revenue up 28% to $8.29bn and EBITDA up 50% to $3.93bn on higher metals prices, and with the company facing an estimated RUB171bn ($2.09bn) under the proposed windfall tax in 2026-2028.
Lower supply is the main support for the price. Nornickel plans 2.4mn-2.46mn ounces of palladium in 2026, 9.5-11.7% less than in 2025. South Africa’s Valterra Platinum (JSE: VAL) reported lower output of platinum group metals in concentrate in 3Q26 and Implats (JSE: IMP) cut July-September production. Safety stoppages and operating limits are holding back new mine supply, according to Nornickel, and Shaposhnikov does not expect a big drop from current prices because high power costs stop South African miners even holding output steady.
Russia, however, is about to add metal. Nornickel faces a nine-month overhaul of one of two furnaces at its Nadezhda plant in 2027-2028, but businessman Musa Bazhaev’s Russian Platinum is due to start up its Chernogorsk plant at the end of 2026, giving the country a second major producer just as its biggest customer buys less.