Largest supply deficit in years, jewelry and investment demand ramping up.
Platinum prices have surged to their highest levels since May 2021, even outpacing gold in year-to-date performance. So far, platinum has risen 32% over the last 12 months, compared to gold’s 26% gain. According to Philipp Götzl-Mamba, a precious metals expert at German raw materials trader TRADIUM, the rally is supported by multiple overlapping factors. Persistent supply constraints in South Africa, the world’s leading platinum producer, coupled with strong demand, especially in the jewelry sector, are key contributors. Here, platinum is increasingly seen as an alternative to gold, following its record-breaking rally and elevated prices. In addition, platinum’s apparent undervaluation relative to gold is fueling further momentum. A similar metric, the gold-silver ratio, has propelled silver over the last week to a 13-year high (we reported).
On the supply side, the World Platinum Investment Council (WPIC) forecasts a market deficit of almost 1 million ounces in 2025, the largest shortfall in years (PDF).
Meanwhile, demand from the financial sector is also on the rise, with holdings in platinum-backed exchange-traded funds (ETFs) reaching a 10-month high, according to Bloomberg, signaling increased participation from institutional investors.
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