SA’s platinum industry is under pressure. Prices have softened, Eskom’s grid problems cut into production and the rise of battery electric vehicles has cast doubt on the long-term role of catalytic converters.
Investors are asking what the future demand story is. One answer lies in hydrogen. Not in a distant future, but in a market that is starting to take shape.
Platinum is central to proton exchange membrane (PEM) electrolysers, which split water into hydrogen and oxygen, and to fuel cells, which turn hydrogen back into power. As countries push to decarbonise steel, chemicals and heavy transport, demand for these systems is rising.
The World Platinum Investment Council estimates hydrogen applications could reach close to 900,000 ounces of annual platinum demand by 2030 (about 10% of the market). That is material, especially as autocatalyst demand levels off.
SA is uniquely placed. It holds the largest reserves of platinum group metals and has emerging hydrogen projects that can link local mining to global growth.
At OR Tambo, Isondo Precious Metals is producing catalyst components for electrolysers and fuel cells. Sasol has piloted hydrogen refuelling at Secunda and is studying large-scale production at Boegoebaai. Hive Hydrogen and the Prieska consortium are developing export-scale plants. These are more than pilots — they are signals that SA can be part of the global hydrogen supply chain.
But opportunity is not the same as impact. If PEM manufacturing consolidates in Europe, China or North America, then platinum will once again leave our shores as ore and concentrate, with little of the hydrogen value captured locally. We have seen this story before with gold and coal: mineral wealth creating royalties and wages but little downstream industry.
Three things can change the outcome:
- SA’s hydrogen strategy must align with its platinum endowment. Current plans focus heavily on megawatt targets and export hubs. They should also set clear goals for local content in PEM components and fuel cell manufacturing. Without that, beneficiation will remain an aspiration.
- Development finance must come with conditions. The Industrial Development Corporation, Development Bank of Southern Africa and Public Investment Corporation are already backing hydrogen projects through new blended finance funds. These investments should be tied to local sourcing of platinum-based components and skills transfer, so that the supply chain deepens rather than hollowing out.
- Credibility matters. Hydrogen buyers in Europe and Asia want secure, reliable partners. If SA delivers projects on time, builds transparent governance and avoids over-promising, it will secure both hydrogen offtake and platinum demand. Credibility is as valuable as ore.
Of course, there are risks. PEM technology may lose ground if alkaline or anion exchange electrolysers scale faster. Iridium loadings are being reduced, which lowers intensity per unit. Water constraints and grid bottlenecks could slow project rollout. A balanced view requires acknowledging these headwinds.
Yet the direction is clear. Platinum’s old demand story is fading. Hydrogen offers a new one, with real industrial relevance. SA can either ride that wave as a raw material supplier, or it can anchor itself as a producer of components, projects and technology. This requires leadership that sees platinum not only as a commodity to be dug out of the ground, but as the catalyst for SA’s place in the clean energy economy.
If we play our cards right hydrogen could give platinum its next big payoff — and SA its next industrial chapter.
• Polley is a senior emerging markets adviser.
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