Palladium Physical Market Brief: 2026-09-01

Executive summary

Physical delivery demand for the active September PA contract remains robust, with the month-to-date total reaching 258 contracts. This level of offtake is substantially higher than seen for the prior month's contract. This strong physical demand contrasts sharply with recent positioning data, which shows managed money holding a significant net short position. This divergence between bearish paper positioning and bullish physical activity is a key dynamic to watch.

Delivery intentions (today + MTD context)

• Today's Activity: For September 1st, another 10 contracts were issued and stopped for the SEPTEMBER 2026 Palladium contract.
• Month-to-Date (MTD) Total: This brings the total for the September delivery period to 258 contracts.
• Trend Context: The delivery period for the September contract began with a very strong 190 notices on August 28th, followed by 58 on August 31st. While the daily pace has slowed, the cumulative total of 258 contracts is already much higher than the total seen for the entire August 2026 contract cycle (which ended with 36 contracts). This indicates a significant increase in demand for physical metal in the current delivery month.

Full delivery data is available on the Palladium Warehouse and Delivery stream.

Warehouse stocks

CME/NYMEX does not publish publicly-audited warehouse stock levels for Palladium, so analysis must rely solely on delivery intention flows.

COT cross-check

• The most recent Commitment of Traders (COT) data, reported as of August 28th, shows a notable divergence between speculative positioning and physical market activity.
• Managed Money: Speculators held a large net short position of 5,499 contracts (4,486 long vs. 9,985 short).
• Divergence: This bearish paper market positioning is at odds with the strong physical demand evidenced by the 258 delivery notices filed for the September contract, which began on the same day as the COT report.

Risks and watchpoints

• Positioning vs. Physicals: The primary watchpoint is the divergence between heavy speculative shorting and strong physical delivery demand. Continued high levels of physical offtake could challenge the bearish paper thesis and potentially force short covering.
• Delivery Pace: Monitor if the pace of delivery for the September PA contract picks up again after the initial surge. Sustained demand through the delivery period would reinforce the signal of a tight physical market.
• Commercial Activity: Commercials (Producers/Merchants) held a relatively small net short position of 423 contracts. Their positioning will be critical to watch in subsequent reports for signs of hedging or physical procurement activity.