Source: Goldprice.org
The demand for platinum jewelry, however, rose by 26% over the same time period. Supply disruptions, in turn, made the platinum market prices go up even more.
The platinum supply disruptions are mostly due to lower mine productivity. This made platinum’s global production total 5.77 million ounces, substantially below the yearly average for the period between 2010 and 2021. Indeed, the supply figures for 2025 are expected to be the lowest since 2020 during the disruptions caused by the Covid-19 pandemic. So, for this year the World Platinum Investment Council expects the deficit to be 966 koz, marking the third consecutive year of platinum deficit.
It is therefore expected that higher investment and jewelry demand, especially in China, would maintain the current platinum price growth. Moreover, greater expectations of Fed rate cuts, and the resulting weakening of the US dollar, will also positively impact platinum demand, which should lead to the metal’s price uptrend. But in my view, the future of platinum is quite uncertain.
What will happen to platinum prices in the future?
As I have mentioned above, there are several factors affecting the price level. So, it is hard to say for sure what the price will be. To be objective in economics, we should consider one factor at a time. At the same time, it is likely monetary policies would stay loose in the near future, given the Fed’s dovish stance. This will lead to a weaker dollar, and higher demand for all precious metals. However, supply deficits come and go. The same is likely to happen to platinum this time. After all, there have already been three consecutive years of platinum deficits. So, it is uncertain when the platinum rally would end or at least lose some of its momentum.