At around $1,050 an ounce, platinum is cheaper than palladium at around $1,500 an ounce and rhodium at some $7,500 an ounce, and automakers are using more platinum and less palladium and rhodium to cut costs.
Meanwhile, production of platinum-intensive heavy-duty vehicles is rising and electric vehicles are taking market share from combustion-driven light vehicles that use a lot of palladium and rhodium.
Johnson Matthey, an autocatalyst maker, said in a report it expected auto sector consumption of platinum to rise by 11% and for investors to stockpile metal, pushing total demand up 19% to 7.46 million ounces.
Supply should grow by 5% but the market will still be undersupplied by 128,000 ounces, Johnson Matthey said, a major shift from last year's surplus of 740,000 ounces.
For palladium, JM said use by automakers would fall by 2%, reducing overall demand to 9.83 million ounces and cutting the market deficit to 43,000 ounces from 531,000 ounces last year.
For rhodium, auto consumption will also fall slightly, but higher demand from the glass industry will boost overall demand to 1.055 million ounces, the report said.
That will leave the rhodium market oversupplied by 14,000 ounces, down from 35,000 ounces in 2022 and the third consecutive surplus.
Also on Monday, consultants Metals Focus forecast deficits of 953,000 ounces for platinum, 707,000 ounces for palladium and 34,000 ounces for rhodium this year, while the World Platinum Investment Council predicted a 983,000-ounce platinum deficit.
Following are numbers and comparisons.
PLATINUM (THOUSANDS OF OUNCES)
2022 2023 % change
SUPPLY
Primary supply (mined) 5,530 5,808 5%
Secondary supply (recycled) 1,468 1,521 4%
TOTAL SUPPLY 6,998 7,329 5%
DEMAND
Automotive 2,762 3,063 11%
Chemical 699 697 0%
Dental & biomedical 253 257 2%
Electrical & electronics 235 266 13%
Glass 594 565 -5%
Investment -565 283
Jewellery 1,344 1,351 1%
Petroleum 230 213 -7%
Pollution control 223 260 17%
Other 483 502 4%
TOTAL DEMAND 6,258 7,457 19%
Movement in stocks 740 -128
PALLADIUM (THOUSANDS OF OUNCES)
2022 2023 % change
SUPPLY
Primary supply (mined) 6,307 6,556 4%
Secondary supply (recycled) 3,099 3,234 4%
TOTAL SUPPLY 9,406 9,790 4%
DEMAND
Automotive 8,449 8,251 -2%
Chemical 589 534 -9%
Dental & biomedical 186 171 -8%
Electrical & electronics 544 545 0%
Investment -109 25
Jewellery 87 88 1%
Pollution control 108 123 14%
Other 83 96 16%
TOTAL DEMAND 9,937 9,833 -1%
Movement in stocks -531 -43
RHODIUM (THOUSANDS OF OUNCES)
2022 2023 % change
SUPPLY
Primary supply (mined) 695 724 4%
Secondary supply (recycled) 338 345 2%
TOTAL SUPPLY 1033 1069 3%
DEMAND
Automotive 953 947 -1%
Chemical 66 82 24%
Electrical & electronics 5 6 20%
Glass -41 5
Other 15 15 0%
TOTAL DEMAND 998 1055 6%
Movement in stocks 35 14
Source: Johnson Matthey <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ PGM deficits or surpluses PGM use in autocatalysts ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Reporting by Peter Hobson; Editing by Jan Harvey)
