Global recycling of platinum declines 15% year-on-year

Global recycling of platinum declined 15% year-on-year (-65 koz) to 352 koz in Q3’23. This was driven by far weaker autocatalyst recycling, which faces challenges in sourcing materials due to three main factors.

First, there has been a shift in car-ownership trends as people have held onto older vehicles for longer partly as they were not used as intensively during the pandemic and partly due to affordability constraints, the result of both high new vehicle prices and the cost-of-living crisis.

Second, the closure of smaller scrap yards and collectors have diminished the sourcing network, exacerbating the supply shortage.

Finally, sharp declines in palladium and rhodium prices have hindered the supply chain, as some market participants have chosen to hold onto their spent autocatalyst inventory hoping for a price recovery, rather than realising losses from inventory acquired in the recent past, often when PGM prices were higher.

In China, autocatalyst supply was also impaired by the introduction of temporary local restrictions. Chinese platinum jewellery scrap continued to weaken, dropping by 5%, mainly driven by lacklustre current and recent jewellery demand. Meanwhile, retail destocking slowed as inventory levels were already low.