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Platinum group metals hope to catch a lift from gold

Kitco News

Sales of platinum bullion products – retail bars and coins – surged to record highs in the first three months of 2020, with purchases made in the period totalling 312 koz, said the World Platinum Investment Council in a news release published today. The annualised rate is five-times higher than that experienced in any other year in the last forty years, said the council.

Platinum prices are still lagging when compared to gold, which may explain the surge in orders. This week gold hit an 8.5-year high and traded above the $1,800 an ounce level. August platinum futures are currently trading at $825.30.

"Platinum’s price is currently near all-time lows relative to gold, and near record lows relative to its sister metal palladium," writes the council. "It is widely understood that this increased demand came from savvy industrial and manufacturing buyers – including jewellery fabricators – exercising a value-led response and taking the opportunity to increase stock levels."

The council is monitoring Asian markets to see if there is an uptick in PGM sales after COVID-19 related disruptions.

"The platinum jewellery market in India suffered more than other markets as steps to reduce the impact of the pandemic caused the cancelling of important festivals and the key wedding season in quarter one. However, PGI believes that, looking ahead, the platinum jewellery market here is also well-positioned to take advantage of low metal prices, as well as benefit from possible industry consolidation.

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