The platinum price reached a level in the third quarter last seen almost 15 years ago – and according to the World Platinum Investment Council (WPIC), the market is likely to remain tight in the coming years. In its latest quarterly report, the industry association expects a gradual normalization, but anticipates only limited easing in the platinum market until at least 2026.
The recent movement was triggered by exceptional market conditions: strong physical demand, disrupted supply chains, and a reallocation of large metal volumes between trading venues. Simultaneously, supply is reacting slowly to higher prices, further exacerbating the structural scarcity of platinum.
Platinum: WPIC Expects Deficit in 2025 and Only Small Surplus in 2026
For the current year, the World Platinum Investment Council forecasts a supply deficit of approximately 692,000 ounces of platinum. This is slightly less than the 850,000 ounces estimated in the second quarter, but still signals a clearly undersupplied market. Analysts expect a broad balance only in 2026 – and even then, only a small surplus of about 20,000 ounces.
Global trade is crucial for this assessment. WPIC Research Director Edward Sterck emphasized in an interview that the slight surplus for 2026 depends on whether global trade relations stabilize. Should trade conflicts ease, approximately 150,000 ounces could flow back from US inventories into the physical market in London, somewhat alleviating the tight situation there.
The current scarcity is closely linked to shifts in the supply chain: Due to concerns about potential import tariffs, banks and market participants have diverted significant quantities of platinum to the USA in recent months. Although the metal, as a precious metal, is not currently subject to direct tariffs, the risk of new duties remains – especially since platinum is listed on the US Critical Minerals List (USGS Critical Minerals List 2025). A large portion of the inventories relocated to the USA has therefore remained there, putting additional pressure on over-the-counter trading in London during a period of rising investment demand.
Platinum Market between Trade War, ETFs, and Physical Demand
In addition to trade flows, the World Platinum Investment Council highlights the role of investment demand. For 2025, the association expects a 6% increase in total investment demand to 742,000 ounces of platinum. This growth is primarily driven by higher ETF holdings: platinum volumes held in exchange-traded products are projected to increase by approximately 70,000 ounces – supported by the recent price surge, robust fundamentals, and the persistent price discount to gold.
At the same time, the WPIC anticipates declining inventories on futures exchanges. Based on improving sentiment regarding potential tariffs, net outflows are expected by year-end, meaning net inflows into exchange warehouses for the full year 2025 are likely to remain limited to approximately 150,000 ounces.
For 2026, however, the association expects a significantly different constellation: Assuming that tariff and trade issues calm down and inventories flow back towards London, investment demand could decrease by 52% to 358,000 ounces of platinum. This scenario envisages a reduction of exchange inventories by approximately 150,000 ounces. Thus, the investment side would contribute more to a normalization, after having been one of the main drivers of the deficit in 2025.
Platinum Supply: Mine Production Weak, Recycling Increases
On the supply side, the picture remains characterized by limited growth, according to the World Platinum Investment Council. For 2025, a 5% decline in mine production to 5.51 million ounces is expected. This puts production approximately 10% below the five-year average from before the COVID-19 pandemic. Sterck points out that even significantly higher platinum prices have so far only marginally stimulated new mine capacities. New projects require years to reach production, so little additional volume is expected in the short term.
Part of the supply gap is being closed by increasing recycling volumes. Despite uncertainties in global trade, scrap supply increased by approximately 8% in 2025. For the full year, the WPIC expects an increase in recycled supply of 7%, or 103,000 ounces, to a total of 1.619 million ounces of platinum. Drivers include higher prices across the entire PGM basket (platinum, palladium, rhodium) and an increasing recovery of used automotive catalysts, as well as higher jewelry recycling, particularly in China.
For 2026, total supply – mine production plus recycling – is projected to increase by 4% to approximately 7.404 million ounces. This growth primarily results from continued strong recycling; mine production, according to the WPIC, remains relatively sluggish despite the price level. The slow supply response contributes to the structural persistence of market tightness, even if short-term surpluses might emerge.
Platinum Demand: Weakness in Industry and Automotive, Increase in Jewelry
On the demand side, the World Platinum Investment Council paints a differentiated picture. Industrial demand for platinum is projected to decrease by approximately 22% to around 1.902 million ounces in 2025. The main reason is an expected cyclical decline in the glass industry, which, after record consumption in 2024, now requires less platinum for production facilities.
In the automotive sector – traditionally a core market for platinum in catalytic converters – the WPIC forecasts a 3% decline in demand to approximately 3.020 million ounces. This is due to declining sales of vehicles with conventional exhaust systems in both the passenger car and commercial vehicle segments. Nevertheless, automotive platinum demand, according to the report, remains approximately 10% above the average of the past five years.
The jewelry sector shows a contrasting trend: Here, the WPIC expects a 7% increase for 2025 to 2.157 million ounces – the highest value since 2018. Particularly in Asia, especially in China, platinum jewelry demand is increasing again, attributed to both changing consumer habits and relative price advantages over other precious metals.
Overall, the World Platinum Investment Council concludes that while the platinum market is moving towards a more balanced supply-demand relationship, structural scarcity persists. Bottlenecks in physical trade, limited mine growth, and slowly reacting demand components thus characterize the picture – and could ensure that platinum remains a market with a tight balance beyond 2025.
