Platinum is facing a notable supply crunch that is largely global in nature, but with strong regional influences shaping the situation. The core of the supply challenge lies in South Africa, which dominates platinum mining by producing nearly 80% of the world’s output. Recent disruptions there—such as power outages and operational difficulties—have caused a sharp decline in production, with global platinum mine output dropping significantly early this year to its lowest level since 2020.
This heavy reliance on South African mines means that any local issues quickly ripple through the global market. However, it’s not just about one region; the overall pipeline for new platinum projects worldwide is very constrained. Platinum is much rarer than gold and difficult to extract because it occurs at very low concentrations in the earth’s crust. This rarity makes scaling up production challenging no matter where you look globally.
The World Platinum Investment Council has forecasted a substantial deficit for 2025 approaching one million ounces—a third consecutive year of undersupply—which indicates that demand continues to outpace what can be mined worldwide. This persistent shortfall has started to eat into above-ground inventories everywhere, tightening market conditions on a broad scale.
On top of supply constraints, demand from key regions like China has been rising sharply. Chinese imports have surged recently as both industrial users and investors show renewed interest in platinum products. This growing demand from Asia adds another layer of pressure on an already tight global supply chain.
In summary, while South Africa’s mining challenges are central to why platinum supplies are squeezed right now, the shortage itself plays out on a global stage due to limited new sources and rising international demand—especially from China—making this truly a worldwide issue rather than just regional scarcity.