Global platinum supply deficit may widen in 2024
Date
5/14/2024 7:43:45 AM
(MENAFN) According to a quarterly report released yesterday by the council, projections for the global platinum supply deficit in 2024 have been revised upward to 476 thousand ounces, marking an increase from the previous estimate of 418 thousand ounces. However, despite this upward adjustment, the anticipated deficit for the current year is deemed relatively low compared to the significant deficit of 851 thousand ounces recorded in 2023, which occurred against the backdrop of a 5 percent decrease in demand.
The report elaborated on the factors contributing to this evolving supply-demand scenario, highlighting that above-ground platinum stocks are anticipated to decline by 12 percent in order to mitigate the expected deficit in 2024. This follows a notable 17 percent decrease in above-ground platinum stocks recorded in 2023, which reached a four-year low of 3.62 million ounces.
In terms of demand dynamics, the report noted an anticipated decline in platinum demand, expected to decrease by 5 percent to 7.587 million ounces. This decline contrasts with the significant 26 percent growth observed in demand for the metal in the previous year. Notably, the automotive sector is expected to drive a modest 2 percent increase in platinum demand in 2024. This increase is attributed to several factors, including a slowdown in demand for battery-powered electric vehicles, a rise in the number of heavy-duty and hybrid vehicles, and stricter emissions legislation favoring the replacement of palladium with platinum in catalytic converters.
Conversely, the report highlighted challenges within the mining sector, particularly in South Africa, where mine production is projected to decline by 2 percent in 2024. This decline is attributed to the prevailing market conditions, including decreased prices for both platinum and palladium. Overall, the report paints a nuanced picture of the platinum market, characterized by shifting supply dynamics, evolving demand patterns, and sector-specific challenges impacting production and consumption.
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