Ruthenium Price Surge: Is This the Start of a Supercycle?

Ruthenium, a lesser-known member of the platinum group metals (PGMs), is quietly making headlines. Up nearly 80% since January 2025, with a gram costing $31.99, this obscure metal is outperforming gold and silver, reaching levels not seen since 2007. But what’s driving this surge, and is it a temporary spike or the beginning of a sustained supercycle?

What is Ruthenium?

Ruthenium (Ru), atomic number 44, is a rare, silvery-white, hard, and brittle metal. It’s one of the six platinum group metals, known for their exceptional catalytic properties, corrosion resistance, and high melting points. Ruthenium is not traded on commodity exchanges, which adds to its price volatility and makes it susceptible to external factors.

Applications of Ruthenium

Ruthenium’s unique properties make it indispensable in various industries:

Electronics: Ruthenium is used in hard disk drives (HDDs) to increase data storage density, chip resistors, and electrical contacts. Its superior conductivity and corrosion resistance are crucial for miniaturization and enhanced performance in electronic devices.
Chemical Catalysis: Ruthenium acts as a catalyst in hydrogenation, metathesis, and oxidation reactions, particularly in the production of fine chemicals, pharmaceuticals, and agrochemicals.
Renewable Energy: Ruthenium is used in dye-sensitized solar cells, modern batteries, and supercapacitors, supporting the development of renewable energy and advanced energy storage solutions. It is also used in fuel cells.
Aerospace and Defense: Ruthenium alloys with platinum or palladium are applied in aerospace, defense, and premium wear-resistant electrical contacts.
Jewelry: Ruthenium is used as an alloying agent with platinum and palladium to enhance hardness and wear resistance in jewelry. It is also used as a plating material for watches, pens, and high-end accessories due to its dark grey luster and corrosion resistance.

The Current Price Surge: A Perfect Storm

Several factors are converging to fuel the ruthenium price surge:

AI-Driven Demand: The rapid growth of artificial intelligence (AI) is a primary driver. Major tech companies like Google, Microsoft, Amazon, and Meta are investing billions in AI infrastructure, leading to a surge in demand for high-density hard disk drives (HDDs) where ruthenium is essential. Cloud computing growth is expected to raise HDD sales by 16% in 2025.
Limited Supply: Ruthenium is primarily obtained as a by-product of platinum and nickel mining, with South Africa and Russia being the major producers. Production is limited and cannot be easily ramped up in response to demand. Weather-related disruptions at major South African producers like Valterra Platinum and Impala Platinum in early 2025 have further tightened supply.
Supply Deficit: Johnson Matthey expects the ruthenium supply deficit in 2025 to widen to 240,000 ounces from 84,000 ounces in 2024. This growing deficit is putting upward pressure on prices.
Stockpiling: Due to its scarcity and lack of trading on commodity exchanges, major buyers are developing stockpiles, adding further impetus to demand.
Increasing Demand for Electronics: Ruthenium is increasingly utilized in electronics due to its superior conductivity and corrosion resistance. Hard disk drives, chip resistors, and semiconductors leverage ruthenium to improve storage density, component efficiency, and device reliability.

Is This a Supercycle?

A supercycle is an extended period of strong demand growth that commodity supply struggles to meet, resulting in sustained price increases. Several indicators suggest that the current ruthenium price surge could be the start of a supercycle:

Strong Fundamentals: The demand for ruthenium is driven by fundamental shifts in technology and industry, particularly the growth of AI and the increasing demand for data storage.
Limited Substitutes: There is currently no cheaper alternative for ruthenium in HDDs, ensuring continued demand growth.
Inelastic Supply: As a by-product of platinum and nickel mining, ruthenium supply is inelastic and cannot easily respond to changes in demand.
Strategic Importance: Ruthenium is increasingly recognized as a strategically important metal, not just a niche PGM side-story.

Investment Opportunities and Risks

Investing in ruthenium can offer lucrative opportunities, but it’s essential to acknowledge the risks and challenges:

Price Volatility: Ruthenium prices can be highly volatile due to supply disruptions, geopolitical tensions, and changes in industrial demand.
Supply Chain Risks: The concentration of ruthenium production in South Africa and Russia exposes the market to political unrest, trade restrictions, and logistical bottlenecks.
Market Manipulation: The lack of trading on commodity exchanges makes the ruthenium market susceptible to manipulation.
Regulatory and Political Risks: Government regulations and political instability in major producing regions can impact ruthenium prices.

Despite these risks, the increasing demand for ruthenium in various industries may present investment opportunities. Investors can consider physical ownership, investing in exchange-traded funds (ETFs), or investing in mining companies.

The Future of Ruthenium

The global ruthenium market is forecast to reach USD 8.9 billion by 2035, up from USD 5.6 billion in 2025, registering a steady CAGR of 4.7%. The increasing use of electronic components, including hard disk drives and computer chips, drives the market’s expansion. Its use as a catalyst in chemical processes, including its applications in hydrogen fuel cells, is another key driver. Moreover, ruthenium’s use as an alloy to increase hardness and strengthen other metals used in wear-resistant components is another key driver.

Conclusion

The ruthenium price surge is driven by a confluence of factors, including the AI revolution, limited supply, and increasing demand from various industries. While risks remain, the fundamentals suggest that this could be the start of a sustained supercycle. Investors should carefully consider the opportunities and risks before investing in this strategic metal.