Platinum mining shortages are worsening because output from major producers has fallen while demand is rising and structural constraints limit quick supply responses. [1]
Key supply-side failures: South Africa, which supplies roughly 70 to 80 percent of mined platinum, has seen declining mine production due to operational problems, lower capital investment and power and logistics challenges that curb output growth[1]. Russia’s platinum output has also fallen because sanctions, equipment withdrawal by Western suppliers and transport bottlenecks have reduced ore and refined output[1]. These two countries’ production setbacks combine to depress global mine supply and make the market more vulnerable to shocks[1][2].
Reinvestment gaps and underinvestment in capacity prevent a rapid supply response. Producers have not committed the level of expansion capital needed to replace aging mines or open new large projects, leaving mine supply constrained even as prices rise[2]. Analysts and industry reports identify a multi-year lag between higher prices and material new mine production because exploration, permitting and construction take many years[2][6].
Inventory and processing limitations amplify shortages. In 2024 some producers drew down inventories and work-in-process stock to meet demand, but that drawdown cannot be repeated indefinitely, so net available supply has fallen back[1]. Refinery and transport bottlenecks, including those induced by geopolitical tensions and sanctions, further reduce refined output even when ore is available[1][3].
Demand-side pressures are increasing and changing the character of platinum consumption. Although automobile demand has been volatile, demand for platinum from industrial uses including autocatalysts, chemical and glass industries and emerging clean-energy applications such as hydrogen fuel cells is rising, supporting higher offtake even during cyclical weakness in some sectors[2]. Investment demand has also surged as investors buy platinum as a precious metal hedge and to gain exposure to a perceived supply squeeze, putting additional pressure on the spot market[4].
Recycling helps but cannot yet fully offset lost mine production. Recycling supply has been growing and is expected to expand further, but current recycling volumes remain insufficient to close the gap left by falling mine output, so deficits persist in the physical market[1][2].
Geopolitical and trade tensions increase risk and unpredictability. Sanctions, export controls, and shifting trade relationships—particularly involving Russian supplies and strategic competition among major economies—have disrupted normal supply channels and discouraged long-term investment in stable supply chains[2][5].
Market outlooks and evidence of worsening shortages: the World Platinum Investment Council and related industry reports forecast substantial deficits for 2025 (around 692 koz to 850 koz depending on the estimate), with mine supply expected to be the lowest since the mid 2010s absent a strong recovery in mining operations[1][2][3]. Analysts expect the deficit to persist into 2026 and beyond unless investment, operational and geopolitical issues are resolved and recycling scales materially[2][6].
Practical implications for markets and users: the tighter physical market has driven large price gains in 2025, increased volatility for industrial users and raised input costs for sectors that rely on platinum[4]. For long-term stability, the market needs either sustained higher investment into mining and refining capacity, improved logistics and energy reliability in producing regions, or significantly larger recycling and substitution in end uses[2][6].
Sources
https://platinuminvestment.com/files/954835/WPIC_Platinum_Quarterly_Q3_2025.pdf
https://www.streetwisereports.com/article/2025/12/15/platinums-impressive-ascent-could-continue-through-2026.html
https://www.prnewswire.com/news-releases/platinum-market-to-end-2025-with-692-koz-deficit-potential-easing-of-tariff-fears-leads-to-a-more-balanced-platinum-market-in-2026-302619223.html
https://fortune.com/article/current-price-of-platinum-12-16-2025/
https://nai500.com/blog/2025/11/platinum-prices-hit-15-year-high-what-are-the-driving-forces/
https://www.kitco.com/news/article/2025-11-19/balanced-platinum-market-2026-wont-fix-fundamental-long-term-issues-wpic
https://www.miningweekly.com/article/balanced-2026-platinum-market-forecast-dependent-on-global-trade-tension-let-up-2025-11-18