WPIC: Platinum to Record Third Annual Deficit as Supply Fails to Meet Demand – Platinum Market Forecast
The comments below are an edited and abridged synopsis of an article by Dean Belder, Investing News Network
WPIC Forecasts Significant Platinum Shortage in 2025
The World Platinum Investment Council (WPIC) projects that the platinum market forecast for 2025 will face its third consecutive annual supply deficit. The expected shortfall is approximately 850,000 ounces, only slightly less than the roughly 968,000-ounce deficit reported in 2024. The shortage is driven by sustained demand and faltering supply, particularly from key mining regions.
Supply Side Problems
Mine production is expected to drop by about 6% in 2025 versus 2024, reaching 5.43 million ounces, down from 5.76 million ounces. South Africa, the largest producer, has been hit hardest; seasonal rains and operational challenges dragged its Q1 output well below expectations. North America and Zimbabwe also anticipate declines of 26% and 4% respectively, while Russia may see a modest 1% increase. Aboveground stockpiles, too, are declining sharply, from 5.51 million ounces in 2022 to under 3 million ounces by the end of this year, covering about four and a half months of demand.
Demand Trends
Overall demand is forecast to fall slightly (around 4%) in 2025, driven largely by reduced industrial and automotive usage. For instance, automotive demand is expected to be about 3% lower year-over-year. However, one bright spot is jewelry: due to platinum’s relative discount to gold, jewelry fabrication is anticipated to rise roughly 11%, with China being a key contributor (estimated jewelry demand growth of about 42% there).
Recycling and Investment Behaviour
Recycling is picking up, especially in automotive sources, but total recycled supply is still under historical norms. Meanwhile, investment demand is mixed: rises in physical holdings of bars/coins are offset by exchange-traded fund (ETF) outflows, some due to tariff concerns. Physical metal is shifting between markets as traders respond to changing narrative and regulatory risk.
Price Dynamics And Outlook
Platinum broke above US$1,450/oz mid-2025. Despite the increase, WPIC analysts believe supply won’t respond quickly at current price levels, largely because much of platinum mining is deep underground; scaling production isn’t something that can happen overnight. Even with possible mine supply improvements later in the year, the fundamental deficit is expected to persist. These conditions suggest strong support for the platinum price over the near to medium term.
Key Takeaways
- According to the platinum market forecast, platinum is expected to incur a large supply deficit in 2025, reinforcing tight market conditions.
- Demand weakness in industrial and auto sectors will be partially offset by jewelry growth and increased recycling.
- Significant upside potential remains for the platinum price if supply fails to improve meaningfully.
