Japanese demand for platinum appears to have dipped slightly this month according to analysts, with rising prices in the industry beginning to impact on the jewellery trade.

Reports from Reuters suggest that imports of platinum in Japan have fallen below five tonnes for the first time in two months.

Data released by the Ministry of Finance (MOF) showed imports fell to 4.71 tonnes, a marked dip from the 5.34 tonnes used in January and 5.81 tonnes in December.

"With platinum prices around $900 (per ounce) and 3,000 yen recently, jewellery companies may have become very cautious about buying," commented one official at a Japanese bullion house.

However, there was some more encouraging news with the revelation that platinum imports had risen on a yearly basis from where they stood in 2003.

In addition many experts speculated that palladium had benefited from the rising platinum price, with demand for the pgm remaining robust.

The MOF data pointed to a surge in palladium imports, which rose by a massive 86 per cent in February to more than six tonnes.

"It's possible that the high price conditions in platinum may have forced end-users to shift into cheaper palladium," explained Tatsuo Kaname, an analyst at Kanetsu Asset Management.

In the longer term experts say changes to automotive regulations in Japan are expected to fuel demand for pgms, as pgm based catalytic convertors are used to meet new stringent emission requirements.