Higher jewelry and investment demand, as well as mining disruptions, offset a decline in the glass and automotive sectors.
The global platinum market is set for its third consecutive annual deficit in 2025, according to the latest quarterly outlook from the World Platinum Investment Council (WPIC). While the projected shortfall has been revised down from earlier estimates, the deficit is still expected to reach 850,000 ounces, or 26.44 metric tons, equal to roughly 12 percent of the total estimated supply for the year.
On the supply side, mining output fell eight percent year-on-year in the second quarter. However, it rebounded strongly from the first quarter, which was disrupted by heavy rainfall and operational issues in South Africa, the world’s primary supplier. Full-year mining production is forecast to decline six percent to its lowest level in five years. As a result, total supply in 2025 is expected to fall by three percent.
Jewelry and Investment Inflow Balance Out a Demand Drop in the Glass and Automotive Sectors
Demand, meanwhile, has proven resilient. Jewelry consumption surged 32 percent year-on-year in the second quarter, led by a 42 percent jump in China. Global investment demand is also up this year, despite temporary outflows from exchange stocks earlier in the year. Lease rates for physical platinum have continuously climbed throughout the year, reflecting a tightening market. However, automotive demand is expected to contract, reflecting tariff uncertainty and weaker vehicle production, according to the WPIC. Industrial usage is forecast to decline 22 percent, primarily driven by a collapse in glass sector demand, though growth continues in hydrogen, petroleum, and medical applications.
Prices have responded decisively to these conditions over the first half of the year. Platinum reached a ten-year high in June, making it the best-performing commodity in the first half of the year (we reported). “The entire precious metals sector is experiencing massive upward momentum, with gold and silver reaching one record level after another. Gold just broke the important €100 per gram mark yesterday, while silver hovers above its 14-year high. Platinum and the platinum-group-metal sector as a whole are no exception, especially the high lease rates highlight the tight supply situation,” said Philipp Goetzl-Mamba, precious metals trader from German-based TRADIUM GmbH.
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