LAST year’s record supply deficit in platinum is expected to narrow this year, but the precious metal will remain sought-after by investors amid complex geopolitics which have increased price volatility, said the World Platinum Investment Council (WPIC).
Commenting in its Platinum Quarterly, the council forecast a 240,000 ounce deficit for platinum in 2026, much lower than the 1,082 million oz last year – the deepest shortfall on record – but with many of the market drivers behind the metal’s rally still in evidence.
“The key drivers of platinum’s price rally in 2025, namely strong supply/demand fundamentals, a depletion of above ground stocks, and macropolitical uncertainty-driven precious metals demand, are expected to persist in 2026,” said Trevor Raymond, CEO of WPIC on Wednesday.
Exchange traded fund (ETF) and exchange stocks were forecast to stay at “elevated levels”, suggesting investment driven by world events would remain top of investors’ agendas. However, the inflows of 2025 were not expected to be repeated. As a result total platinum demand would fall 8% to 7,62 million oz in 2026, the WPIC said.
Supply would increase 2% as recycling was incentivised. Mine supply would remain flat overall with improvements from South Africa offset by Russia. The WPIC has forecast total platinum supply in 2026 of 7.38 million oz.
Some of these factors have resulted in increased price volatility for platinum, and its sister metals palladium and rhodium. Commenting last week, Northam Platinum CEO Paul Dunne said while there was speculative “froth” in the market, the outlook for PGMs was far improved from just six months ago.
In the last six months, platinum is 60% higher in price with a significant gain in value in the dying days of the year owing to derivatives trading on the newly launched Guangzhou Futures Exchange (GFEX) in China. GFEX could “potentially deepen the deficit versus current projections once these are made publicly available,” said Raymond.
Price volatility has continued into this year. On Tuesday, platinum shed 12% which, in the context of recent price gyrations, was not too significant.
“The kind of tailwinds that platinum enjoyed into the end of the year were ones that were shared with gold and silver, and were part of the broader pivot to hard assets — the safe-haven trade — and that attracted a whole load more investor interest from all around,” said Ed Sterck, director of research at the WPIC.
“And with that will come volatility,” he added. “The volatility is probably something that investors need to be prepared to accept.”