The long-term outlook for platinum from a demand perspective is pretty robust. The question, once again, is whether supply will be adequate to meet it.

“In terms of automotive demand, we can’t overlook that the drivetrain is going to continue to electrify. “It’s just the pace of that electrification that is quite difficult to predict as things stand at the moment,” World Platinum Investment Council (WPIC) research director Edward Sterck commented to Engineering News & Mining Weekly in a Zoom interview.

Sterck was responding to a question on WPIC’s long-term demand forecast, following its publication in late November of the ‘Platinum Quarterly’ for the third quarter of 2024, which pronounced the third consecutive platinum market deficit of 539 000 oz for 2025.

Automotive demand continues to feature as a demand growth driver for 2025, with the slowdown in battery electric vehicle (BEV) demand leading to a sustained automotive platinum need over a longer period, bolstered by stricter emissions legislation, more hybrid vehicles that contain platinum-catalysed internal combustion engines (ICEs), as well as the additional use of platinum to substitute palladium

Interestingly, automotive demand is projected to hit an eight-year high of 3 245 000 oz next year amid above-ground platinum stocks being poised to fall in 2025 to 3 014 000 oz.

“As things stand at the moment, we’ve seen that ongoing consumer reluctance to adopt full battery electrification is resulting in a slower rate of the growth in BEV market share, so higher-for-longer ICE,” Sterck pointed out.

Overall, however, a negative compound annual growth rate (CAGR) of around 1.2% in total platinum group metals demand for automotive applications is expected.

For jewellery, the long-term outlook is broadly flat, but with some signs of upside potential beginning to show.

While significant subsectors of industrial demand go up and down, industrial demand has over the last 11 years been at a consistent 3.5% CAGR, which is expected to continue.

Meanwhile, in the 2030s, hydrogen is likely to become the biggest sector of all of the others and more than offset the decline in automotive demand.

On the long-term investment demand front, continued growth of demand for the physical bar and coin is likely, with exchange-traded fund, or ETF, demand expected to begin to reflect the ongoing deficits.

“But at some point, given we’ve got ongoing shortages of platinum for the foreseeable future, ETFs may become a source of supply, albeit at much higher prices than we see today.”

Supply Deficit

The supply deficit theme is becoming embedded by ongoing mine supply constraints, with a slight 2025 recycling recovery forecast owing to improved availability of end-of-life autocatalytic converters.

The market is expected to reach a deficit of 682 000 oz in 2024, as the exceptionally strong demand from the previous year is sustained, reaching 7 951 000 oz (flat year-on-year) and again exceeding supply, which remains constrained at 7 269 000 oz – a 2% increase year-on-year.