Theme of the Day: The global platinum market will swing to a 265koz surplus this year, its first since 2022 - WPIC

For full year 2026, a platinum market surplus of 265koz is forecast, according to the World Platinum Investment Council (WPIC). This is overwhelmingly due to investment outflows that occurred during H126 against a backdrop of heightened macroeconomic and geopolitical uncertainty. The modest surplus expected this year follows three consecutive years (2023-2025) of significant deficit and does little to reduce the platinum market's reliance on exceptionally lean and increasingly illiquid above ground stocks. The WPIC expects platinum to continue to trend in line with overall sentiment towards precious metals, which could provide potential upside for platinum investment demand during the remainder of the year, especially should interest rate increases fail to materialise or prove lower than expected. In Q226, the platinum market recorded a surplus for the second successive quarter, at 244koz. Total supply was broadly stable YoY at 1,906koz (+1%), while total demand fell by 16% (-308koz) YoY to 1,663koz. Exchange traded fund (ETF) outflows of 234koz, resulting in net disinvestment of 121koz, were the single largest factor behind the quarterly surplus. Meanwhile, industrial demand growth of 6% YoY (+33koz) to 600koz could not offset weaker-than-expected jewellery demand, down 32% YoY (-215koz) to 456koz, and softer YoY automotive demand of 729koz (-6%, -49koz). For full year 2026, the ETF outflows seen in H126 are expected to reverse, partially offsetting the 548koz surplus in H126 and resulting in a forecast annual surplus of 265koz. Total supply is projected to increase 2% (+123koz) YoY to 7,353koz on the back of recycling growth alone. Total demand is forecast to fall 18% YoY (-1,582koz) to 7,089koz, principally due to significantly lower investment demand YoY. The impact of the modest surplus expected in 2026 on above ground stocks (AGS) is mitigated by a prior-year adjustment, which has resulted in the estimated 2025 deficit deepening to 1,440koz (+249koz versus the WPIC's previous estimate). In 2026, AGS are forecast to increase to 2,010koz by year end, providing just over 3.4 months of global demand cover. Automotive demand resilient in the face of headwinds from the US-Iran conflict and China weakness: Oil-price volatility and wider inflationary pressures associated with the US-Iran conflict have contributed to a lowering of expected light-duty vehicle (LDV) production, which is now projected to decline by 1% YoY in 2026, with the contraction concentrated in catalysed vehicles. As a result, global automotive platinum demand is forecast to fall by 4% YoY (-136koz) to 2,904koz, a relatively modest (-2%, -55koz) downgrade on the WPIC's previous forecast. Higher precious metals prices and cost of living concerns continue to impact jewellery demand: In full year 2026, platinum jewellery demand is forecast to decline by 15% YoY to 1,883koz. The contraction is concentrated in China, where the reversal of last year's inventory build, weak consumer demand and a renewed trade preference for gold are expected to drive a sharp fall in fabrication. Forecast for industrial demand growth upgraded on AI-related glass and electrical applications: In full year 2026, a 5% (+119koz) YoY increase in industrial demand to 2,385koz is forecast, an uplift of 7% (+147koz) on the WPIC's previous forecast as AI applications boost both glass and electrical demand. YoY growth in glass demand (+23%, +98koz), chemical demand (+9%, +50koz), medical demand (+4%, +11koz), electrical demand (+19%, +19koz) and hydrogen demand (+8%, +6koz) will more than offset lower petroleum demand (-28%, -50koz).