Platinum did indeed experience a significant supply deficit in 2025, marking the third consecutive year of such a shortfall. The World Platinum Investment Council (WPIC) projected a full-year deficit of approximately 850,000 ounces (koz) for 2025, confirming a persistent market tightness driven primarily by declining mine supply and strong demand dynamics.
The supply side saw a notable contraction. Total platinum supply was forecast to decline by about 3% to 7,027 koz in 2025, the lowest level in five years. This decline was largely due to a 6% drop in mining supply to around 5,426 koz, which itself was 11% below the five-year pre-COVID average. The reduction in mine output was exacerbated by operational challenges such as heavy rainfall in South Africa, the world’s largest platinum producer, which caused flooding and disrupted production in the first quarter. South African mine supply fell sharply, with a 24% year-on-year decline during peak months, compounded by chronic underinvestment, power outages, and water shortages. These structural issues have led to shaft closures, restructuring, and delayed investments, making a quick recovery unlikely despite rising platinum prices. Recycling supply showed some recovery, increasing by 6% to 1,601 koz, but remained below historic levels, unable to fully offset the mining shortfall.
On the demand side, platinum continued to enjoy robust interest across several sectors. Total demand was forecast at 7,877 koz for 2025, down slightly by 4% year-on-year, mainly due to reduced demand from the glass sector. However, other areas showed strength. Jewelry demand, particularly in China, rose significantly—by about 11% to 2.23 million ounces, reaching the highest level since 2015. This surge was partly driven by platinum’s relative price discount to gold, encouraging increased jewelry production and purchases. Industrial demand remained relatively strong, supported by platinum’s role in catalytic converters and emerging green technologies such as hydrogen fuel cells. Automotive demand was stable quarter-on-quarter, with platinum increasingly substituting palladium in gasoline vehicle catalysts and maintaining relevance despite the rise of battery electric vehicles. Investment demand also surged, with long positions rising sharply as investors sought to diversify portfolios and hedge against inflation amid global economic uncertainties.
The combined effect of shrinking mine supply and sustained demand led to a drawdown in above-ground stocks, which were forecast to decline by 22% to about 2,978 koz in 2025. This reduction in inventories contributed to a tighter market balance and supported platinum prices, which reached a ten-year high of around $1,450 per ounce in mid-2025 and remained elevated compared to previous years. The market deficit and supply constraints have created a volatile environment, with prices influenced by factors such as gold and silver price movements, the US dollar value, and geopolitical developments.
In summary, the platinum market in 2025 was characterized by a clear and significant supply deficit driven by a combination of declining mine production, especially in South Africa, and strong demand from jewelry, industrial, automotive, and investment sectors. This deficit has contributed to higher prices and a tighter market, with ongoing challenges in supply expected to maintain this dynamic in the near term.