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* Russian state sales in 2012 estimated at 250,000 oz
* Expected to drop to around 100,000 oz this year
* Norilsk 2013 palladium output to decline slightly
By Polina Devitt
MOSCOW, May 13 (Reuters) - Sales of palladium from Russianstate stocks are likely to contribute less to supply this yearand "in the foreseeable future" than they did in previous yearsafter falling by two-thirds in 2012, Johnson Matthey said.
Sales of Russian state stocks have helped keep the palladiummarket in surplus for eight of the last 10 years. Stocks at theGokhran state repository are almost depleted following thoseexports, platinum refiner JM said on Monday in its Platinum 2013report.
JM said it believed there might be some residual sales ofmetal in 2013 but at much reduced levels of around 100,000ounces. That low level is likely to leave the market in astructural deficit, potentially pushing prices higher.
"What has been gleaned in the last few years supports agrowing consensus ... that sales from stocks in 2013 will beless than half of the 2012 level, which was itself sharply downon earlier years," the company said.
JM estimated that sales of palladium fromgovernment-controlled inventories fell to 250,000 troy ounces in2012 from 775,000 ounces the previous year.
"If this outlook is correct, the overall supply of primarypalladium in 2013 will probably fall, as it is unlikely that newproduction this year will be able to compensate for thepredicted drop in sales of palladium from Russian stateinventories," the refiner added.
Production of platinum group metals from Norilsk Nickel's Russian operations, the main source of palladiumsupply to the market, is expected to decline in 2013.
JM cited Norilsk's 2013 guidance for palladiumoutput of 2.60-2.61 million ounces and platinum output of640,000-650,000 ounces at its Russian divisions.
Last year its total output was 2.73 million ounces ofpalladium and 683,000 ounces of platinum, down 3 percent and 2percent year-on-year respectively.
Norilsk accounts for 41 percent of global palladium outputand 11 percent of platinum production.
JM lifted its estimate for Russian rhodium production in2012 to 90,000 ounces from 70,000 ounces late last year, afterNorilsk refined large quantities of stored pyrrhotiteconcentrate, which is relatively enriched in rhodium.
