Platinum prices have been on the rise recently, driven by a mix of supply shortages and growing demand. One of the main reasons behind this surge is a significant supply deficit that has persisted for several years now. In 2025, newly mined platinum production is expected to drop by about 6%, reversing previous growth trends. This decline in output comes amid ongoing challenges in major producing regions like South Africa, where mining difficulties and limited recycling keep supply tight.
At the same time, demand for platinum is increasing across various sectors. The automotive industry continues to use platinum in catalytic converters, especially as some electric vehicle adoption slows down compared to earlier expectations. Jewelry demand is also picking up strongly, particularly in China where consumer interest has grown noticeably. Industrial uses and investment interest add further pressure on available supplies.
Because of these factors—falling mine production combined with rising consumption—the market faces a structural deficit that could last for years. Experts forecast annual deficits averaging around 727,000 ounces through 2029, which means more platinum is being used than produced each year. This imbalance steadily depletes above-ground stocks; inventories are projected to shrink to critically low levels near just 2.5 million ounces by the end of this year.
This tightening market situation creates upward pressure on prices. After starting 2024 near $1,000 per ounce and dipping slightly during the year, platinum prices have rebounded sharply in early 2025 and are expected to climb further toward $1,200 or even higher within months if current trends continue.
Investor interest also plays a role as uncertainty grows globally with shifting economic conditions and trade tensions affecting markets worldwide. Some investors see precious metals like platinum as attractive alternatives amid concerns over currency fluctuations and inflation risks.
In short, what’s driving the latest surge in platinum prices boils down to less metal coming out of mines while more industries want it—and not enough stockpiles left to fill that gap easily—making this rare metal increasingly valuable right now.