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Platinum Quarterly is commissioned by the World Platinum Investment Council and based upon independent research and analysis conducted by Metals Focus. We publish similar commentary every quarter ensuring greater transparency of the global platinum market and the delivery of regular data to investors. The next Platinum Quarterly will be published on 8th September 2020.

This twenty-third edition of the Platinum Quarterly, published on 18th May 2020, includes Q1 2020 analysis of platinum supply and demand fundamentals. It also gives a view of the global above ground stocks of platinum and an outlook for market fundamentals for 2020.

The full report is available here:

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Overview of key data presented in the latest Platinum Quarterly:

This report incorporates analysis of platinum supply and demand during the first quarter of 2020 as well as a revised full year forecast for 2020.    

While the COVID-19 pandemic has had a major negative effect on the platinum market — including price, demand and supply — the results for Q1 2020 show the net effect is less than feared, and the outlook for 2020 is better than expected.  

The platinum price fell together with that of most equities and metals during March; suffering falls of between 10% and 35%. Platinum demand in China reduced early in the quarter. However, a smelting process failure in South Africa, unrelated to the pandemic, as well as mine closures to reduce the spread of the virus significantly reduced quarterly platinum supply.  

Total demand in Q1 2020 declined by 5% (-94 koz) to 1,649 koz from the previous quarter. Meanwhile, total supply decreased by 19% (-410 koz) to 1,773 koz from Q4 2019. This resulted in a surplus of 124 koz for Q1 2020.  

WPIC now forecasts that 2020 will have a surplus of 247 koz, which is only 128 koz higher than its previous forecast despite the impacts of COVID-19. Demand in 2020 is expected to be 18% lower than in 2019 mainly on weak automotive and jewellery sales and lower investment demand. Supply is forecast to be down 13%, year-on-year, on the material impact of the smelting outage and pandemic related mine stoppages.  

Strong investment demand for bars and coins
First-quarter bar and coin investment surged to 312 koz in Q1 2020 – up over 300% on the quarterly average of 70 koz in 2019. This was driven by a jump in bar and coin demand in both Japan and the US, while demand in Europe also increased albeit from a low base. The increase was largely driven by bargain-hunting following the price fall in March. Bar and coin investment demand is expected to surge by 115% to 605 koz in 2020.  

This comes at a time when the platinum price remains at historic discounts to itself, to gold and to palladium.  

Implementation of more stringent automotive emissions legislation is likely to drive demand in 2020
Automotive demand in Q1’20 was down 17% (-132 koz) to 634 koz, year-on-year, as COVID-19 induced plant closures led to a rapid drop in manufacturing output and an unprecedented fall in sales. These stoppages, first in China but soon thereafter globally, reduced demand for platinum during the quarter.  

While total automotive platinum demand is forecast to fall by 14% (-413 koz) in 2020, automotive demand in China is expected to increase by 14%, despite the effects of COVID-19. The phasing in of China VI standards for heavy-duty vehicles drives an increase in loadings that outweighs the expected decline in units produced. Similarly, the implementation in India of the Bharat VI legislation in April 2020, is also likely to increase demand for platinum, despite the lockdown restrictions that are currently in place.