Platinum Market Surplus Hides Persistent Supply Constraints
The platinum market is expected to see a modest surplus of 265,000 ounces in 2026 following a revised deficit of 1.44 million ounces the previous year. However, this improvement does not reflect an increase in primary production but rather weaker investment demand and higher recycling rates. The World Platinum Investment Council (WPIC) notes that global mine supply is projected to remain flat at 5.55 million ounces due to geological limitations affecting deep-level mining operations. South Africa remains the dominant producer, accounting for around 70% of global platinum output from narrow reefs like Merensky and Upper Group 2 in the Bushveld Igneous Complex. These challenging conditions limit mechanization and scale-up potential despite rising prices. Additionally, PGMs are often mined alongside other metals such as gold and nickel, complicating supply dynamics. The transition to electric vehicles poses a long-term threat to demand for palladium and rhodium used in catalytic converters, while platinum may find new applications in green hydrogen and AI infrastructure.
Topics: market surplus/deficit PGMs (Precious Group Metals) platinum supplies