What is the rarest precious metal in the world? If you answered gold, the all-time favorite precious metal, that’s incorrect. Platinum is actually the rarest precious metal and another popular commodity among investors.
In recent years, however, the price of platinum has not reflected its rarity. Despite being famously used in catalytic converters to help cars emit fewer harmful emissions, it has been struggling to break out from the weak trend of the past two years due to subdued demand, particularly from the auto industry. Auto manufacturing makes up 44% of platinum’s demand.
While its precious metal cousin, gold, has repeatedly beaten its own record highs, platinum prices are still working their way up to $1,000 – about less than half of its all-time high price of $2,290 per ounce in March 2008. It briefly reached over $1,000/oz early this year before falling again.
It briefly reached $1,105/oz on May 20, the highest price since May 2023 and the highest price so far in 2024, before retreating to below $1,000. According to Reuter’s report, gold surged to another record high that day due to a range of factors, including U.S. rate cut expectations and China’s new economic stimulus, which also lifted other precious metals, such as silver and platinum. Platinum often benefits from rising gold prices.
The deficit in the platinum markets in recent years, however, has offered support amid weak demand.
Will platinum prices recover this year?
We look into factors that will affect the metal’s prices and explore analysts’ latest short- and long-term platinum price forecast.
Key Takeaways
- The price of platinum is expected to increase in the coming years as constrained supply persists.
- Platinum demand for converters in internal combustion engines (ICE) will persist for a long time despite the growing electronic vehicles (EVs) segment.
- Sustainably weak platinum prices could further constrain output.
- The hydrogen economy is a potential new source of demand for platinum.
- Show Full Guide
Platinum Price Predictions Summary
| Year | Forecast Range | Key Factor |
|---|---|---|
| 2024 | $953.19to $1,050/oz |
|
| 2025 | $991.69 to $1,273/oz |
|
| 2030 and beyond | $1,250/oz
General sentiment: bullish |
|
Platinum Prices in 2023: A Sharp Fall Despite Deficit
In the turbulent four years since the onset of the COVID-19 pandemic in 2020, the platinum price trend has experienced a roller-coaster ride.
Platinum managed to recover from the lows of below $600 per ounce induced by the onset of the COVID-19 pandemic in March 2020 and even gained 11% overall in 2020 due to a widening deficit.
Lower supply due to COVID-19-related mine closure, the temporary shutdown of Anglo American Platinum’s Anglo Converter Plant (ACP) in South Africa, and reduced recycling caused a deficit of 932,000 ounces in the platinum market in 2020, according to industrial group World Platinum Investment Council (WPIC). It was the largest annual deficit on record.
The lower supply outstripped the weak demand from the auto industry, jewelry, and industrial sectors as the COVID-related restrictions slowed activities.
In the following year, although platinum price hovered above $1,000/oz in the first half of 2021, it dropped more than 10% for the full year.
Weak demand from the automotive sector, which struggled with semiconductor shortages and logistical bottlenecks, combined with a surplus in the market as mine production recovered, dragged down platinum prices in 2021. Data from the WPIC showed that the platinum market recorded a surplus of 1.29 million ounces in 2021.
In 2022, platinum price recouped its losses, gaining about 12% in the year, which was in line with gains in other precious metals. Expectations that demand from China, the world’s biggest auto market and production hub, might improve after the country lifted its three-year strict COVID restrictions boosted the market amid continued surplus.
Platinum price gave up its gains in 2023, dropping almost 7% in the year despite the market swinging back to deficit on the back of robust demand and constrained output. South Africa, home to 70% of global PGM output, faced ongoing electricity supply shortages, strikes, and planned closures.
According to WPIC, the platinum market recorded a deficit of 878,000 in 2023. Total platinum supply fell by 2% while demand surged by 25% year-on-year.
Wahyu Laksono, the founder of the Jakarta-based trader community platform Traderindo, said the looming recession in the US due to the Federal Reserve’s hawkish monetary tightening and slower-than-expected China’s economic recovery hurt industrial metals, including platinum and palladium.
Laksono told Techopedia.com:
“Gold and silver benefited from the recession risks and slowing China’s economic growth because both serve as safe-haven assets. But platinum and palladium, along with other industrial metals, were still waiting for certainties in the global economy.”
The growing use of platinum and palladium-free electric vehicles has also reduced the market share of ICE vehicles in recent years.
According to the International Energy Agency (IEA), the share of electric cars in total global car sales rose from just 2.5% in 2018 to 18% in 2023. The agency expected EV sales to reach 17 million cars in 2024, up from almost 14 million in 2023.
Key Factors Affecting Platinum Prices in 2024
At the time of writing on August 20, platinum price has dropped 4.18% since the start of the year, trading at around $965/oz. It briefly reached $1,015/oz in early January before dropping in the following weeks and regaining to touch the highest price in 2024 at $1,105 on May 20.
Let’s examine what factors will affect platinum price predictions in 2024.
Deficit to Persist
The platinum market was expected to remain in deficit in 2024. In its first quarter 2024 report on May 13, WPIC projected the deficit to narrow to 476,000 ounces in 2024 from 851,000 ounces in 2023. In the first quarter of 2024, the platinum market experienced a deficit of 369,000 ounces.
The group estimated supply to fall 1% to 7.11 million ounces in 2024 from 7.17 million ounces in 2023 due to lower mine output from South Africa, which accounts for 70% of global mine supply, and Russia. On the other hand, demand was expected to fall by 5% to 7.58 million ounces, still outstripping supply due to softer industrial demand, with fewer glass and chemical plant expansions forecast for this year.
ANZ Research’s analysts Daniel Hynes and Soni Kumari said a protracted downtrend in the prices of PGMs platinum group metals (PGM) is one of the key factors constraining mine and secondary supply, causing persisting tight platinum market.
They wrote on June 11:
“Narrowing margins have led major miners to restructure plans to optimize costs. This will likely delay growth projects and keep some mines in a state of care and maintenance. The delay in capex expansions is also weakening the prospects of long-term production growth.”
In its report on December 14, 2023, WPIC estimated the PGM basket price declined about 40% in 2023, leading to lower profitability across PGM miners. At a platinum spot price of $1,250/oz, around 25% of PGM mine production generated negative cash margins.
They added that although the available platinum stocks stand at 3.62 million ounces, accounting for 47% of demand, and can be withdrawn to meet 2024 demand, a structural deficit of platinum will potentially reduce inventories over the coming years.
“Nevertheless, fundamentals are constructive in the medium and long term as a plethora of supply challenges and healthy demand from the auto and new-energy sectors will keep the platinum market structurally undersupplied.”
They expect the market deficit to widen from 518,000 ounces to above 650,000 ounces (8% of annual demand) in 2024.
ANZ Research estimated global platinum mine production to contract by 2% year-on-year (YoY) to 5.67 million oz in 2023.
Palladium-to-Platinum Switch
Platinum and palladium can substitute each other as both have physical and chemical properties fit for autocatalysis. From the 2000s, the substitution palladium-to-platinum ratio between the two metals in autocatalysts moved to 1:1 from previously 2:1. Platinum is mostly used in catalysts for diesel vehicles. In contrast, palladium is used in gasoline vehicles.
Since late 2017, palladium’s price premium over platinum has made the latter a favored substitution for auto manufacturers.
On average, palladium could be two times higher than platinum, peaking at $3,000 in 2022. However, on February 8, 2024, palladium price briefly fell below platinum for the first time in five years. On that day, palladium dropped to $869.6/oz, while platinum stood at $874.5.
Palladium prices have been dropping as more consumers switch to palladium-free electric cars.
Hynes and Kumari from ANZ Research expected that the ongoing trend of replacing palladium with platinum in vehicles will continue even though platinum is now more expensive than palladium. This is partly because vehicle design and production, including the selection of metals used as components, are not frequently changed and typically span seven years.
Analysts wrote:
“So we expect platinum to benefit from additional substitution demand until 2026. The auto catalytic demand ratio for Pd-to-Pt is still above 2.6 against ratio of 2 in 2013, so there is still room for more substitution.”
ANZ Research forecasts that platinum’s demand as an auto catalyst will grow by 1% to 3.37 million ounces in 2024, against a 600,000-ounce contraction in palladium demand due to slowing auto sales and a shift to platinum.
WPIC estimated that demand from vehicle production will grow at a modest 1% in 2024, from 16% in 2023, amid ongoing inflationary pressure and high rates. In addition, the anticipated falling market share of internal combustion engine (ICE) vehicle production to 64% from 71% in 2023 will exert downward pressure on platinum demand, according to the group.
In addition to economic factors, Hynes and Kumari said in February that supply security was another reason behind the shift from palladium to platinum. Russia produces 38% of global palladium from its nickel mines. The palladium market has been experiencing a structural deficit for the past few years, which has led to demand rationing.
Furthermore, WPIC cautioned about growing risks that the substitution rate of platinum for palladium could stall now that platinum price moves towards a parity or premium to palladium.
At the time of writing on August 20, platinum was trading at $965/oz compared to palladium, which was trading at $910/oz.
However, reversing the substitution towards palladium could take years, as changing the technology is a lengthy process.
Therefore, the switch usually takes place in a new car model. WPIC estimated that the gradual substation from platinum to palladium could start in 2026 if the palladium market does enter a surplus in 2025.
The group foresees platinum for palladium autocatalyst substitution is expected to reach 700,000 ounces in 2024, up from an estimated 620,000 ounces in 2023.
Fed’s Rate Cuts
ANZ Research’s Hynes and Kumari said platinum will also get support from rising gold prices when the US Federal Reserve starts its rate-cutting cycle.
Markets had expected that the Fed would begin lowering rates as early as March. However, the US inflation rate, which has stubbornly stayed above the Fed’s target of 2%, has diminished this optimism. Now, the market anticipates that the rate-cutting cycle will start in September.
According to CME FedWatch, about 75.5% market participants expected the Fed will cut its benchmark rate to 5.00% – 5.25% from its current target of 5.25%-5.50%.
Higher rates strengthened the US dollar, weighing on industrial metals over the past two years. This strengthened dollar raises commodity prices for buyers using local currencies.
Emission Reduction Measures to Lift PGM Loading
Since 2023, the European Union has announced key measures to reduce car emissions. These measures could increase the use of PGMs, including platinum, potentially bode well for the outlook for platinum prices. Cars account for one-fifth of the EU’s CO2 emissions.
The bloc has planned to ban the sale of new petrol and diesel cars from 2035 to reach net zero emissions from cars and vans. However, Reuters reported on July 2 that the European People’s Party, the biggest lawmaker group in the European Parliament, will seek to weaken the bloc’s planned 2035 phase-out of CO2-emitting cars. This could be negative platinum price news.
Daria Efanova, head of research at Sucden Financial said signs of reversing the policy to ban internal combustion engine (ICE) cars by 2035 has casted serious doubt about the future of the policy, especially from Germany, a key producer and seller of both electric and ICE vehicles.
She added that achieving “those harsh targets will be quite difficult for the governments and nation going forward.” So, it will be a slow process.
“So for now, I don’t necessarily expect that to be key and driving platinum and palladium prices for the next quarter,” Efanova said in a webinar on July 17.
Another EU’s emission reduction policy that could affect platinum price expectations is the adoption of the Euro 7 regulation that stipulates stricter emission limits for road vehicles and battery durability.
“Stricter emission regulations will continue to favor higher PGM loadings, benefiting platinum demand. Europe is set to switch from Euro 6 to Euro 7 in July 2025 for light-duty vehicles. Car manufacturers are planning for Euro 7 catalytic decisions. While emission limits are the same for light-duty vehicles as Euro 6, limits will likely be stringent for heavy-duty vehicles,” ANZ Research’s Hynes and Kumari wrote in the note on June 11.
They added that in North America, the phase-in of Federal Tier 3 legislation will see a gradual increase in PGM loadings. In California, the implementation of Heavy-Duty low oxides of nitrogen (NOx) engine emission standards is also boding well for platinum demand.
“Heavy-duty vehicle production is set to grow in 2024, which may require higher platinum loadings. This will offset some of the weakness due to contraction in light-duty vehicles this year,” they added.
Platinum Price Forecast 2024
| Analyst/source | Platinum Price Forecast 2024 (March) |
Platinum Price Forecast 2024 (August) |
|---|---|---|
| ANZ Research | $1,058/oz, up from $945 in 2023 | $1,033/oz |
| Fitch Ratings | n/a | $1,050/oz (June 18) |
| Wahyu Laksono | $800 – $1,000 | n/a |
| Trading Economics | $898.33/oz end of Q1 2024; $847.03 in 12 months’ time | Q3: 953.19
Q4: 972.25 |
ANZ Research projected that the price of platinum would continue climbing over 2024, ending the year at $1,200/oz in December 2024, from $950 by the end of Q1 2024. Overall, it expected the precious metal to trade at an average of $1,033/oz in 2024, a downward revision from $1,058/oz in February, but it is up from an estimated average of $945/oz in 2023.
ANZ Research’s Daniel Hynes and Soni Kumari wrote in their platinum price forecast for 2024 on June 11:
“We expect prices to find support near USD950/oz; a break below this level could trigger another fresh sell-off to USD900/oz. While the downtrend is strong now, a reversal to prices above USD1,020/oz can stimulate some buying to push prices towards USD1,050/oz. If platinum continues to trade above USD1,050/oz, prices could hit a high of USD1,100/oz/.”
Wahyu Laksono estimated platinum price to trade between $800 and $1,000 per ounce in 2024, based on a persistent deficit.
Trading Economics shared ANZ Research’s upbeat forecast. The economic data provider, in its latest platinum price projections for 2024, expected platinum to continue climbing to$953.19/oz in Q3 and $972.25/oz in Q4, as of August 20.
In its first expanded metal price assumptions to cover PGMs, Fitch Ratings forecast platinum to average $1,050/oz in 2024.
Platinum Price Prediction 2025
| Analyst/source | Platinum Price Forecast 2025 (March) |
Platinum Price Forecast 2025 (August) |
|---|---|---|
| ANZ Research | $1,273/oz (Feb. 11) | Unchanged |
| Fitch Ratings | n/a | $1,050/oz |
| Wahyu Laksono | $900 – $1,100 | n/a |
| Trading Economics | $847.03/oz in 12 months’ time from Q1 2024 | Q1: 991.69
Q2: 1,011.50 |
As for 2025, ANZ Research expected the platinum price to trade higher at $1,273/oz, up from an average of $1,033/oz in 2024.
Laksono of Traderindo foresees the metal could range between $900 to $1,100 per ounce as the market could remain undersupplied. He said:
“The main positive fundamental factor for platinum is deficit. Analysts are confident that the supply side will support platinum in the future through the decline in mining output.”
Fitch Ratings’ platinum price prediction saw the metal remain unchanged at $1,050 in 2025.
Trading Economic’s platinum price expectations anticipated the metal to continue its uptrend, rising to $991.69/oz in Q1 and to $1,011.50/oz in Q2 2025.
Platinum Price Prediction 2030: Betting on Hydrogen Economy
| Analyst/source | Platinum Price Forecast 2026-2030 |
|---|---|
| Fitch Ratings | 2026: $1,050/oz
2027: $1,050/oz 2030: n/a |
| Wahyu Laksono | 2028: $1,250
2030: n/a |
What are the platinum price predictions for the next 5 years? The exact platinum price forecast for 2030 is unavailable now because of multiple unpredictable factors that could affect platinum prices over such a long period.
Fitch Ratings’ medium-term outlook for platinum prices projected that the metal would stay at the $1,050/oz level until 2027. The rating agency said:
“Also, at the start of the war in Ukraine, many automakers increased PGM stocks due to concerns over potential sanctions reducing supply (as Russia’s Norilsk Nickel is a large platinum and palladium producer). These stocks are now being unwound, which has led to significant price declines in 2H23 and 2024. Once destocking is complete and if some producers cut production, prices should be supported at the levels incorporated in our assumptions for PGMs in 2024-2027.”
Traderindo’s Laksono predicted platinum price could reach as high as $1,250 per ounce by 2028.
He said:
“The opportunity to go above $1,000 is very much open in the long term.”
Despite the absence of platinum price expectations for 2030, the World Platinum Investment Council projected the future of platinum remains attractive, partly because the markets are expected to record consecutive years of deficit.
WPIC estimated the market would remain undersupplied, with deficits between 500,000 ounces and 612,000 ounces between 2025 and 2027.
On one side, mine supply could be at risk of further decline if weak prices continue to force miners to operate at negative margins. According to WPIC, because of the decline in the price of platinum group metals (PGM) in 2023, around 25% of primary PGM supply is generating negative margins at 2022 costs.
On the other hand, platinum demand is anticipated to remain resilient.
Demand for platinum in internal combustion engine (ICE) automotive is expected to persist for a significant period, supported by sustained strength in industrial demand and the potential for further growth from the hydrogen economy, according to WPIC.
These factors would bode well for platinum future price predictions.
ANZ Research’s Hynes and Kumari highlighted in June 11 note that hydrogen will become crucial for countries to achieve carbon neutrality and decarbonize sectors such as steel, heavy-duty road transport, shipping, aviation and chemicals. They said:
“Platinum is a critical mineral in building this technology, in particular for upstream production via electrolysis and fuel cells for mobility and stationary power applications,” adding that platinum demand from fuel-cell electric vehicles (FCEV) and stationary hydrogen fuel cells will compensate for losses from declining ICE vehicles.
While noting that the hydrogen economy in the decarbonization race will be a new source of demand for platinum, Laksono of Traderindo said it may not be significant.
“Producers and analysts expect that the metal has the potential to get support from the hydrogen economy through fuel cell electric vehicles (FCEVs) which will compete with battery electric vehicles (BEVs).”
According to the World Platinum Investment Council, fuel cell electric vehicles (FCEVs), which use platinum-based hydrogen (H2) fuel cells to generate electricity, will account for 75% of projected hydrogen-related platinum demand.
The Bottom Line
Platinum price has upside potential in the coming years, as constrained mine supply and healthy industrial and automotive demand are expected to keep the platinum markets in deficit until at least 2028.
The hydrogen economy, with the emergence of fuel cell electric vehicles (FCEVs), represents a promising source of demand for platinum. However, its success will depend on the widespread adoption of FCEVs for heavy-duty transportation.
Do your own research and always remember your investment decision depends on your attitude to risk, your expertise in the commodity market, the spread of your portfolio, and how comfortable you feel about losing money.
The information in this guide does not constitute investment advice and is meant for informational purposes only.
FAQs
Is platinum a good investment?
Will Platinum go up or down?
Should I invest in platinum?
References
- Platinum: The Rarest Precious Metal (Sprott)
- Anglo American Platinum closes ACP Phase B resulting in temporary build up in work-in-progress inventory (Angloamericanplatinum)
- PLATINUM ESSENTIALS Updating WPIC’s two- to five-year platinum supply/demand outlook: Multi-year deficits expected (Platinuminvestment)
- WPIC Platinum Quarterly Q4 2023 (Platinuminvestment)
- Trends in electric cars – Global EV Outlook 2024 – Analysis – IEA (Iea)
- Electric car sales, 2012-2024 – Charts – Data & Statistics – IEA (Iea)
- WPIC Platinum Quarterly Q1 2024 (Platinuminvestment)
- PLATINUM ESSENTIALS Platinum’s consecutive market deficits could deepen as lower PGM prices increase mine supply risks (Platinuminvestment)
- Platinum-for-palladium substitution – 60 Seconds in Platinum – About Us – World Platinum Investment Council – WPIC® (Platinuminvestment)
- CME FedWatch – CME Group (Cmegroup)
- EU ban on the sale of new petrol and diesel cars from 2035 explained (Europarl.europa)
- Sucden Financial Q3 2024 Metals Market Webinar – 17 July 2024 on Vimeo (Player.vimeo)
- Euro 7: Council adopts new rules on emission limits for cars, vans and trucks (Consilium.europa)
- Federal Register :: Greenhouse Gas Emissions Standards for Heavy-Duty Vehicles-Phase 3 (Federalregister)
- Heavy-Duty Low NOx | California Air Resources Board (Ww2.arb.ca)
- Commodity…lithium Forecast 2024/2025 (Tradingeconomics)
- Fitch Ratings Expands and Updates Global Metals and Mining Price Assumptions (Fitchratings)
- Hydrogen Demand – Supply & Demand – World Platinum Investment Council – WPIC® (Platinuminvestment)
