Theme of the Day: Third consecutive annual platinum deficit reconfirmed

Platinum has broken out of its post-pandemic trading range to be the top-performing commodity in H125, outpacing gold, silver, and broader asset classes. Its price rose dramatically in Q2, and in Jul it reached a ten-year high of $1,450/oz.Forecast full year 2025 total supply is the lowest in five years, declining by 3% to 7,027koz. Total demand will decline by 4%, nevertheless outstripping supply by 850koz.Platinum jewellery demand to rise 11% to 2,226koz this year, its highest level since 2018, as China growth accelerates. Platinum continues to benefit from its price discount relative to gold.Continued growth in investment demand, up 2% in 2025 to 718koz, with strong bar and coin demand performance in China.Modest decline in automotive demand forecast given tariff-related market uncertainty; forecast to contract 3% to 3,033koz for full year 2025.Industrial demand to fall to 1,901koz this year as substantive, cyclical glass capacity expansions reduce.Total supply is expected to decline 3% to 7,027koz in full year 2025. This will be its lowest level in five years, with mining supply falling 6% to 5,426koz, also its lowest level in five years. Recycling supply is forecast to grow 6% to 1,601koz in full year 2025, although it will remain depressed compared to historic levels.The platinum market is expected to record its third consecutive significant annual deficit in 2025, projected at 850koz, a downward adjustment of 116koz from the previous forecast. Above ground stocks are forecast to decline by 22% to 2,978koz in 2025 (including a restatement of historical estimates), resulting in four and a half months of demand cover.Platinum market tightness has been evident since Dec 2024, illustrated by extremely high lease rates and deep backwardation in the London over the counter (OTC) forward market. This market tightness has persisted, despite the significant price increase that started during Q2, which encouraged metal into the market, suggesting that a further increase in price is required to meet ongoing market shortages.Looking to the remainder of 2025, platinum’s investment case remains compelling, with the platinum market in structural deficit. Platinum’s sustained, significant discount relative to gold continues to add to its appeal. This is especially true in China, where both jewellery demand and bar and coin demand are forecast to show exceptionally strong growth this year. The success of Shanghai Platinum Week, which achieved record-breaking attendance and is increasingly drawing an international audience, demonstrates heightened interest in platinum, both as an investment asset and as a critical mineral across multiple value chains.