The results of Thomson Reuters GFMS' Platinum & Palladium Survey 2013 are in, and the news looks good for palladium investors. According to the precious metals consultancy, palladium recorded its highest deficit in 11 years in 2012. Specifically, supply of the metal fell to 8.19 million ounces, a 4-percent decline, while usage grew 5 percent, hitting 9.32 million ounces. That created a 1.12-million ounce gap between supply and demand, a sizeable increase over 2011′s 279,000-ounce deficit. Residual deficit for the year (calculated by taking Russian stockpile sales and ETF demand into account) came in at 1.16 million ounces, down from a residual surplus of 1.05 million ounces in 2011. The lack of supply was largely the result of lower output from South Africa and Russia, the two biggest producers of palladium in 2012, as per the US Geological Survey. Strikes brought South Africa's production down by 10 percent while Russia put out 3 percent less palladium than it did in 2011, according to Bloomberg's report on the GFMS survey. A "slight reduction" in autocatalyst recycling, caused by scrap collectors holding inventory in anticipation of better pricing, also contributed to the decrease in supply. About two-thirds of demand was driven by the need for palladium for autcatalysts, a Kitco article on the survey notes. This type of demand rose 9 percent on the back of increased vehicle sales and as a result of palladium's growing use as a substitute for platinum in diesel applications. The end of Russian stockpiles? Russia delivered 400,000 ounces of palladium from its stockpiles in 2012, a 50-percent drop from the 800,000 ounces it put out in 2011, and GFMS believes that downward trend is likely to continue.