Platinum investors benefited from bargain hunting in August

Global bar and coin demand rose by 78% (+42 koz) year-on-year during Q3’20 to 96 koz. This reflected gains in every key retail investment market, but most significant in volume terms were the increases in North America and Japan.

Both markets benefited from bargain hunting in August and early September when the platinum price weakened. In the case of Japan, this helped offset price-related liquidations earlier in the quarter.

Furthermore, some of the product shortages in North America, which hit demand in Q2’20, were not as acute during Q3, though they were not entirely addressed. Interestingly, retail activity in that market appeared largely one-way, with little sign of selling back either when prices jumped in July or then recovered towards the end of Q3.

European bar and coin investment edged higher in Q3’20 on the previous quarter and remained at an elevated level. In line with Q2’20, investor interest in platinum bars and coins was fuelled by the metal’s attractive price levels, especially compared to gold.

Sales also benefited from an easing of product shortages.

The strong investor interest in platinum ETFs seen in Q2’20 accelerated during Q3’20, with holdings growing by +543 koz to close September at an all-time high of 3.8 moz. Exchange of futures for physical (EFP) volatility and sponge discounts to ingot persisted during Q3’20, resulting in further inflows into CME approved vaults in the US and increasing stocks held by exchanges to 342 koz.

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