Can you name a commodity that’s currently in a supply deficit—in other words, production and scrap material can’t keep up with demand? How about two? If you find that difficult to answer, it’s because there aren’t very many. When you do find one, you might be on to a good investment—after all, if demand persists for that commodity, there’s only one way for the price to go. At the end of 2012, the platinum market was in a supply deficit of 375,000 ounces. Much of it was chalked up to the sharp decline in output from South Africa, where about 750,000 ounces didn’t make it out of the ground due to legal and illegal strikes, safety stoppages, and mine closures. The palladium sector was worse: It ended the year with a huge supply deficit of 1.07 million ounces—this, after 2011, when it boasted a surplus of 1.19 million ounces. The huge reversal was due to record demand for auto catalysts and a huge swing in investment demand—going from net selling to net buying in just 12 months. What’s important to recognize as a potential investor is that the deficit for both metals isn’t letting up, especially for platinum.