Global demand for platinum jewellery is expected to rise by 11% to about 2.2-million ounces in 2025, its highest level since 2018, due to a spike in manufacturing in China, the World Platinum Investment Council (WPIC) said on Wednesday.
Spot platinum prices are up 51% so far this year after hitting their 11-year high of $1,483 (R26,039) an ounce in July as inflated import demand in China coincided with outflows to US stocks amid tariff concerns and lower supply from mines.
A continuing rally in gold prices, which hit a record high this week, has been a big factor as it prompted some Chinese jewellery showrooms to build up platinum inventory amid higher financing costs from rising gold prices.
As a result, platinum jewellery manufacturing in China more than doubled year on year in the second quarter and is expected to rise 42% to 585,000oz in 2025, the WPIC, which uses data from consultancy Metals Focus, said in a quarterly report.
“However, without conclusive evidence that retail consumption is matching the pace of fabrication and concerns about a short-term price correction grew, after platinum's price gains, showroom and manufacturer activity slowed sharply in June,” the WPIC said.
The WPIC, whose members are major Western platinum producers, said it expected a 3% reduction in platinum consumption from the car sector and a 22% fall in demand from other industrial sectors due to fewer glass capacity expansions.
Together they will cause a 4% decline in the overall demand for platinum to 7.9-million ounces this year. This will bring the structural market deficit to 850,000 ounces compared with 966,000 ounces projected four months ago, the WPIC said.
To cover the deficit, above-ground stocks will fall by 22% and will be equal to four-and-a-half months of global demand.
SA is the world's leading platinum producer.
Reuters
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