Demand for platinum jewellery in China, which has declined significantly over the past decade, has started picking up, helping drive a deeper than previously expected global platinum deficit this year, the World Platinum Investment Council said on Monday.
Chinese platinum jewellery fabrication rose 26% year-on-year in the first quarter, supported by platinum’s discount relative to gold prices , which are up 21% this year following a 27% rally in 2024. Platinum is up 9% this year after two years of decline.
“With gold prices rising and gold jewellery demand underperforming, wholesalers and regional retailers took profits by liquidating unsold gold inventory and rebuilding platinum stock,” the WPIC, which uses data from consultancy Metals Focus, said in a quarterly report.
It expects platinum jewellery demand in China to rise by 15% to 474,000 troy ounces this year. To be sure, this is still far away from the peak of China’s demand, which reached 2 million ounces in 2014 and then started sliding as lower platinum prices damaged consumer sentiment.
Global demand for platinum jewellery will rise 5% to 2.1 million ounces in 2025, said the WPIC, whose members are major Western platinum producers.
This will not be able to offset a 2% reduction in consumption from the auto sector and a 15% decline in demand from other industrial sectors such as the chemical or glass industries. Together they will cause a 4% decline in the overall demand for platinum to 8.0 million ounces this year.
Meanwhile, total supply will fall 4% to 7.0 million ounces, the lowest in five years, due to mined output declining in all key producing regions, except Russia.
This will bring the structural market deficit to 966,000 ounces compared with 848,000 ounces projected two months ago, the WPIC said.
To cover the deficit, above-ground stocks will fall by 31% to 2.2 million ounces, equal to three months of global demand.
(By Polina Devitt; Editing by Sam Holmes)
