Platinum is gearing up for a major upswing in 2025, driven by a mix of tight supply and growing demand that’s hard to ignore. The metal’s fundamentals are pointing toward a significant price increase, making it an intriguing opportunity for investors and industries alike.
First off, platinum supply is expected to shrink notably next year. New mining output is forecasted to drop by about 6%, reversing the growth seen last year. This decline is largely due to ongoing production challenges, especially in South Africa—the world’s largest platinum producer—and limited recycling efforts that haven’t bounced back to previous levels. With no big new mines coming online anytime soon, the total platinum available will fall below 7 million ounces in 2025. This creates what experts call a “structural deficit,” meaning demand consistently outpaces supply over several years.
On the demand side, things are heating up across multiple sectors. Platinum has long been used in automotive catalytic converters to reduce emissions, but now its role is expanding into new technologies tied to the energy transition—particularly hydrogen fuel cells—which require this precious metal as a critical component. Additionally, Chinese jewelry demand for platinum continues to grow strongly, adding another layer of consumption beyond industrial uses.
Investment interest itself has surged as well. After years of being overshadowed by gold and silver, platinum is finally catching investor attention due to its undervaluation relative both historically and compared with other precious metals like gold. Investors see potential not only because of current deficits but also because above-ground inventories are shrinking fast; if these stocks run low within just a few years without new supply stepping up significantly, prices could spike sharply.
The market dynamics here are unusual because both supply and demand tend not to respond quickly or strongly enough when prices change—this means imbalances can persist longer than usual before correcting through higher prices or increased production capacity (which takes time). As such deficits continue year after year—expected at around 9% below average annual demand from 2025 through at least 2029—the pressure on prices builds steadily.
All these factors combined suggest that platinum may be nearing what some call a “tipping point.” Prices have already risen about one-third so far this year amid these trends but could push much higher if current conditions hold or worsen slightly on either side of the equation.
In short: shrinking mine output plus rising industrial use (especially green tech) plus growing investment interest equals strong upward momentum for platinum prices heading into and throughout 2025—and possibly beyond into the late decade as structural shortages persist without quick fixes on either end of supply or demand curves.