Platinum market to move to a deficit in 2023

Mar 09, 2023

World Platinum Council (WPIC) released the Platinum Quarterly report of Q4 2022 & said, this edition of Platinum Quarterly presents fourth quarter and annual platinum supply and demand developments for 2022 as well as an updated outlook for 2023.

It also includes the WPIC’s views on issues and trends relevant to those investors considering exposure to platinum as an investment asset, plus an update on how our product partnerships continue to meet investors’ needs. The Platinum Quarterly data and commentary 2023 forecast deficit of 556 koz as supply remains weak with strong demand growth.

After two years of significant surpluses the platinum market is forecast to move to a material deficit in 2023. The change from the 776 koz surplus in 2022 to the forecast deficit of 556 koz in 2023 is over 1.3 Moz which reflects mining and recycling supply remaining close to the weak levels in 2022, up only 3% (201 koz) and strong demand growth of 24% (1,534 koz).

Although power supply risks and operational challenges have been factored into the mining supply forecast for 2023, a worsening of electricity supply shortages in major producer South Africa and a gradual erosion of operational stability in Russia, linked to ongoing sanctions, present downside risks to supply.

In contrast, although demand forecasts include the negative impact of inflation and lower global economic growth, downside risks are well protected as the strong demand growth results mainly from ongoing platinum for palladium substitution in automotive applications, already committed glass capacity additions, with construction to be completed in 2023, and robust bar and coin demand, while the significant outflows from ETFs and exchange stocks have largely run their course.

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