Following two consecutive platinum market deficits in 2023 and 2024, the World Platinum Investment Council (WPIC) forecasts this year to again remain in deficit by as much as 539 000 oz, with total demand remaining strong at only 1% lower than in 2023 at 7.86-million ounces, while total supply is expected to remain constrained, increasing by 1% to 7.32-million ounces.

The WPIC’s third quarter 2024 report forecasts that the platinum market was expected to reach a deficit of 682 000 oz by the end of 2024, as “exceptionally strong” demand from 2023 was sustained, reaching 7.95-million ounces, exceeding supply of a forecasted 7.27-million ounces – a 2% increase year-on-year.

“Twenty-twenty-five will mark the third consecutive year in which the platinum market experiences a significant and meaningful deficit, driven by robust demand and ongoing supply vulnerabilities,” says WPIC CEO Trevor Raymond.

Driving the continued elevated demand for platinum is the automotive sector, in which demand is projected to hit an eight-year high this year of 324 500 oz; while the platinum jewellery sector is also expected to grow with a 2% year-on-year increase this year, driven by a surge in fabrication in India.

“The continued growth in automotive demand features as a demand growth driver for 2025. The slowdown in battery-electric vehicle sales, contrary to expectations, is leading to sustained automotive demand for platinum over a longer period.

“All the while, platinum demand is bolstered in this sector by stricter emissions legislation, an increase in hybrid vehicles that contain internal combustion engines (ICEs), and the growth in [yearly] platinum-for- palladium substitution,” he says.

The automotive demand remains strong as automakers adjust strategies to boost lower-CO₂-emitting ICE-based hybrid vehicle sales, to mitigate regulatory challenges.

As for platinum demand in the jewellery sector, the WPIC expects growth to continue this year, with the projected 2%, or 32 000 oz, increase in demand to reach a total of 198 300 oz. Growth is anticipated to continue in India and is also expected in North America, driven by post-election sentiment and, in China, supported by product innovations.

The WPIC also points out that the industrial sector experienced robust demand in the third quarter of 2024, increasing by 15% year-on-year, or 76 000 oz, driven by a 10% rise in the electrical and medical sectors and a 96% jump in glass sector demand, albeit from a low base.

For full-year 2024, the WPIC reports that industrial demand will ease back by just 1% compared to 2023, reaching 243 400 oz.

However, gains in the electrical (1% to 90 000 oz), medical (4% to 303 000 oz), hydrogen (123% to 64 000 oz) and glass (29% to 671 000 oz) sectors will be offset by a 28% decline in the chemical sector, as cyclical capacity expansions in China conclude, the council notes.

After three years of “exceptional growth” the WPIC says industrial demand is projected to contract by 218 000 oz to 2.22-million ounces in 2025, representing a 9% decrease. This downturn is primarily a result of a 57%, or 385 000 oz, drop in platinum demand from the glass sector to 286 000 oz, owing to fewer capacity expansions.

However, the WPIC says 2025 is expected to see strong growth in the chemical sector of 17% to 656 000 oz, petroleum sector by 31% to 211 000 oz, medical sector of 4% to 314 000 oz, and hydrogen sector of 32% to 84 000 oz.

“At a time when the global economy is uncertain, one might expect an industrial metal like platinum to perform poorly. However, platinum demonstrates its resilience [owing] to its diverse end-uses, even in the current environment,” says Raymond.

For 2025, total investment demand is expected to rise 7% to 420 000 oz, driven mainly by growth in stocks held by exchanges and an 8% increase in demand for bars of 500 g and larger in China.

While global bar and coin investment demand is forecast to ease by 12% to 151 000 oz, bar and coin demand in North America is projected to return to growth.

Platinum exchange traded fund holdings are also expected to rise by 50 000 oz, as some US investors look to gain exposure to higher-for-longer ICE vehicle production.