Platinum demand surged 25% in 2023 and will remain robust in 2024
The platinum market shifted to a significant deficit of 878 koz in 2023. Total demand surged by 25% year-on-year, reaching 8,009 koz, whereas total supply fell to 7,131 koz, the second-lowest figure since 2013, surpassed only by the COVID-impacted year of 2020.
A further deficit of 418 koz is expected for 2024. Demand is anticipated to reduce by 6% to 7,507 koz – however this is still above the five-year average since 2019 – while total supply is projected to decrease further by 1% year-on-year to 7,089 koz.
Further decline in platinum recycling exacerbates total supply constraints in 2024
Global recycling supply dropped for the third consecutive year in 2023, down 14% year-on-year to 1,495 koz, some 22% below the pre-COVID five-year average. This was mainly due to a drop in spent autocatalyst recovery, driven by stricter North American anti-theft regulations and China’s restrictions on autocatalyst recycling. A 7% improvement to 1,600 koz is expected in 2024 as spent autocatalyst supply recovers and regulatory restrictions ease.
Global mine supply for 2023 was 5,636 koz, marking a 1% uplift from the reduced supply levels of the previous year. Looking ahead to 2024, global platinum mine supply is expected to decrease by 3% to 5,489 koz.
Automotive platinum demand expected to hit a seven-year high in 2024
In 2023, automotive platinum demand surged by 16% to 3,272 koz, benefiting from rising vehicle production and a greater hybrid vehicle share. Additionally, stricter emissions standards for both light and heavy-duty vehicles, especially in China, also drove demand growth. Moreover, platinum-for-palladium substitution reached 669 koz in 2023, a significant rise from 391 koz in 2022.
Growth in automotive demand will continue in 2024, albeit at a more muted pace, with a projected rise of 1% year-on-year to 3,297 koz to reach a seven-year high. The continuation of robust growth in both heavy-duty and hybrid vehicle numbers, alongside stricter emissions legislation and an increase in platinum-for-palladium substitution (forecast to reach around 742 koz), will offset the expected overall decrease in global internal combustion engine vehicle production.
Record industrial demand in 2023, with 2024 well above five-year pre-COVID average
Industrial demand hit a record high in 2023, increasing by 12% to 2,622 koz, driven by significant expansions in the glass (up 39% to 701 koz) and chemical sectors (up 13% to 771 koz).
Without the same level of capacity expansions in 2024, industrial demand is forecast to fall by 14%. Nevertheless, it will be 12% above the pre-COVID five-year average at 2,258 koz.
Second year of positive net investment in 2024
In 2023, the platinum investment landscape witnessed a notable recovery with a swing to positive net investment of 265 koz. This resurgence was highlighted by a 22% increase in retail demand for platinum bars and coins, particularly driven by a significant turnaround in Japan. However, despite an early uptick in platinum exchange-traded fund (ETF) investments, the year ended down by 20 koz.
In 2024, net investment in platinum is projected to remain positive for the second year running at 52 koz. Global investment in bars and coins will fall to 152 koz, driven by an anticipated increase in platinum prices over the year, which could entice some investors, particularly in Japan, to take profits. Platinum ETF holdings are expected to decline by 120 koz, influenced by high interest rates in Europe and North America, while exchange warehouses are anticipated to see inflows of 20 koz.
Increase in platinum jewellery demand forecast
In 2023, global jewellery demand fell by 3% to 1,850 koz with increases in India and North America unable to offset weaknesses elsewhere, particularly in China. For 2024, global jewellery demand is expected to rise by 3% to 1,900 koz, driven by significant growth in India.
