After an exceptional year for gold and silver, platinum and palladium are increasingly coming into focus – driven by tight inventories, structural supply risks and classification as critical metals.
Platinum catching up: Strong performance after years in the shadows
For many market participants, 2025 was clearly dominated by gold and silver. However, in the background, platinum, together with palladium, has recovered significantly – and some analysts see 2026 as the year in which the platinum group metals (PGMs) are likely to come even more into focus.
Silver was the driving force among precious metals in 2025, gaining almost 150%. Platinum followed with an increase of more than 126%, while palladium was able to gain around 80%. Despite this strong rally, the PGMs have not fully caught up with the development of gold and silver over several years.
Analysts point out that the fundamental picture in the market for platinum and palladium is becoming increasingly narrow. While investor interest has so far often been dominated by gold and silver, experts are talking about an environment for 2026 in which a broader view of the precious metal range could be worthwhile – without making any specific recommendations.
Platinum between the automotive industry, industrial demand and scarce supplies
A central theme for platinum and palladium remains the automotive industry. Around 80% of the demand for platinum group metals comes from the automotive sector, where they are used in catalytic converters for combustion engines to reduce emissions.
In recent years, high expectations for the growth of electromobility (EV) have weighed on PGMs, as purely electric vehicles do not require classic exhaust catalytic converters. In the meantime, however, the forecasts for the pace of EV penetration have been adjusted somewhat downwards. Analysts at TD Securities expect demand for vehicles with combustion engines – especially in the USA – to remain more stable than long expected, which is supporting demand for platinum and palladium.
In addition, platinum not only plays a role in the powertrain. The metal is used in the glass industry, in electronics and in various industrial applications. Robust industrial consumption is expected for 2026 – the crucial question is whether supply can keep pace.
The World Platinum Investment Council (WPIC) pointed out in November that the platinum market may be heading towards a more balanced state after three years of deficits. At the same time, above-ground inventories have fallen significantly. According to WPIC, global platinum reserves currently cover only about five months of demand. Against this background, a significant rebuilding of inventories in the short term seems unlikely, which could keep the physical market permanently tighter.
Critical metals: Geopolitics, tariffs and inventory build-up as price drivers
The supply situation for platinum and palladium is not only a question of mine production and recycling, but increasingly also of geopolitics and regulation. The US Geological Survey USGS already classified platinum and palladium as critical metals in November 2025.
This classification reinforces the discussion about strategic stockpiling and possible trade measures. TD Securities refers to a development towards a “war economy logic”, in which states and companies increasingly stockpile critical raw materials. An ongoing Section 232 investigation in the USA holds the possibility of tariffs on PGMs in the room – even if implementation should be delayed.
Combined with an increasing spread of “just-in-case” storage systems – i.e. the conscious build-up of additional safety stocks – this could contribute to the fact that global stocks do not rise back to previous levels. For the important London market, the ongoing, in some cases “artificial” supply shrinkage would prolong a phase of increased physical scarcity.
Structurally, many market observers see the supply side as vulnerable anyway. After a decade of limited investment in new projects, long-term production capacity is capped, according to Nicky Shiels, Head of Research and Metal Strategy at MKS PAMP, according to a Kitco News report. She speaks of “persistent structural deficits” that could support platinum in the medium term – especially if investor interest in PGMs should increase or political risks additionally burden supply chains.
Platinum price scenarios 2026: Between 1,375 and 2,000 US dollars
However, the assessments of the further price development of platinum and palladium differ significantly.
On the more optimistic side, MKS PAMP expects platinum prices of up to $2,000 per ounce in 2026. TD Securities expects an average of around $1,800 per ounce in the second half of 2026 and thus also sees scope towards the $2,000 mark.
The WPIC has highlighted the role of exchange warehouses in its scenario calculations. Platinum inventories in CME warehouses rose by around 350,000 ounces in 2025. Assuming that no trade barriers arise, these inflows could be largely reduced again by the end of 2026.
Depending on whether exchange inventories continue to grow or flow out again, the deficit picture changes significantly:
- If inflows remain at the previous level, the platinum market deficit could increase from 692,000 to 891,000 ounces in 2025.
- If inventories are reduced, the deficit would decrease to 542,000 ounces in 2025.
- For 2026, a possible deficit of 329,000 ounces results with continued inflows; with strong outflows, a surplus of around 219,000 ounces would even be conceivable.
- This range shows how strongly inventory movements and trade flows can overlay the structural picture – with direct consequences for the platinum price.
Divided expert view: Opportunities, risks and the role of gold and silver
Not all houses share the optimistic assumptions for platinum and palladium. BMO Capital Markets calculates an average platinum price of around $1,375 per ounce for 2026 and sees palladium at an average of around $1,150. The bank remains clearly more constructive on gold and silver in its overall view and points out that an oversupply of PGMs could reduce the pressure in the spot market because industrial customers would be less dependent on the sale of investor inventories.
Commerzbank also expects platinum to remain supported in 2026 by the tight market situation and its role as a critical metal, but expects only limited further upside potential. The analysts – similar to TD – see an average platinum price of around $1,800 in the second half of 2026, but at the same time assume that the extreme scarcity could ease somewhat if the market recovers from the current deficit phase and the momentum in gold subsides.
The bottom line is that the forecasts for platinum and palladium paint a picture between structurally strained supply, political uncertainty and, in some cases, already high expectations in the market. One thing is clear: After the exceptional year 2025 for gold and silver, the platinum group metals are moving more into focus.
