The global platinum market is set to experience a significant supply shortfall in 2024, with demand expected to surpass supply by 1.03 million ounces, according to the World Platinum Investment Council (WPIC). This forecast represents a notable increase from the 476,000-ounce deficit projected earlier this year.
The surge in demand is attributed to robust inflows into exchange-traded funds (ETFs), which saw 444,000 ounces in the second quarter, along with rising jewelry sales in the US and Europe. Additionally, the automotive sector has contributed to the heightened demand, with a 1% increase to 820,000 ounces in the second quarter, pushing the projected annual automotive demand to a seven-year high of 3.24 million ounces for 2024.
On the supply side, refined mine production grew by 4% in the second quarter, reaching 1.54 million ounces, driven by a 7% increase in South African output. However, the WPIC forecasts a 2% decline in South African production for the year, reducing the total mined platinum supply to a four-year low of 5.51 million ounces.
Despite these supply-demand dynamics, platinum prices have remained stagnant. Trevor Raymond, CEO of WPIC, attributes this to market sentiment rather than fundamental supply-demand factors, noting the lingering impact of the 2015 Dieselgate scandal and decreased light-duty diesel vehicle sales in Europe.
