The World Platinum Investment Council (WPIC) reported that the global platinum deficit in 2025 will be more severe than initially anticipated. This is primarily due to a decrease in supply from the recycling sector and reduced output from South African mines. Despite a 5% decline in demand, the projected deficit of 848,000 troy ounces this year is expected to be smaller than the 995,000 ounces shortfall in 2024, as stated in the WPIC’s quarterly report.
Previously, the WPIC had forecasted deficits of 539,000 ounces for 2025 and 682,000 ounces for 2024. Inflows into physically backed platinum exchange-traded funds, driven by rising gold prices, and into Comex exchange stocks due to US tariff concerns, have bolstered platinum investments. This trend is expected to continue throughout the year.
While demand from the automotive sector, a significant consumer of platinum in catalytic converters, is projected to decrease by 1% to 3.1 million ounces, the main factor influencing the revised deficit estimate is a 278,000-ounce reduction in the recycling forecast for this year. Global platinum recycling dropped by 1% in 2024, reaching its lowest level since 2013, with only marginal growth expected in 2025 due to supply constraints in spent autocatalysts and declining jewelry recycling.
To offset the deficit, above-ground platinum stocks are anticipated to decrease by 25% to 2.5 million ounces, equivalent to less than four months of global demand. The Council attributes the diminishing stockpile to the unlikelihood of an expected market improvement in the near term.
Investors have been encouraged by platinum’s investment potential, with positive trends in physically backed funds and exchange stocks. The Council’s outlook underscores the critical role of platinum in various industries, particularly in emissions control technology for vehicles.
Despite challenges in the recycling sector and mine production, platinum remains a sought-after commodity with a unique set of industrial applications. The Council’s projections provide valuable insights into the dynamics of the platinum market and underscore the importance of sustainable supply chains and recycling practices in maintaining a balanced market.
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