The World Platinum Investment Council (WPIC) has reported that the platinum market experienced a supply deficit for the third consecutive year in 2025. Notably, the deficit has widened annually since 2023, with the 2025 shortfall of 33.6 tons marking the largest gap since records began in 2013. Last year's market was characterized by a doubling of platinum prices, driven by investor optimism toward precious metals amid persistent deficits, declining above-ground stocks to unsustainable lows, and a volatile macroeconomic and political environment. Looking ahead to 2026, the council has revised its earlier supply-demand balance forecast to a deficit of 7.5 tons. This adjustment reflects robust investor sentiment, which is expected to stabilize ETF holdings rather than trigger profit-taking as previously anticipated. Additionally, trade-related concerns are likely to keep exchange inventories at elevated levels.
In 2025, total platinum supply fell by 1% year-on-year to 224.4 tons. Mine supply declined by 4%, while recycling supply increased by 10%, partially offsetting the reduction in mining output. Total platinum demand rose by 1% to 258.1 tons, with investment demand surging 65% and jewelry demand growing by 9%, its strongest performance since 2018. These increases were sufficient to counterbalance a cyclical low in industrial demand. The market deficit for 2025 reached 33.6 tons, exceeding the previous quarterly forecast of a 21.5-ton shortfall by 12.1 tons. The widening gap was primarily driven by heightened investment demand, particularly strong growth in ETF holdings and exchange inventories.
The platinum market is expected to remain in deficit in 2026. Total supply is projected to increase by 2% compared to 2025, with recycling supply anticipated to grow by 10% due to higher prices stimulating the recovery of spent automotive catalysts and increased recycling of old jewelry. Mine supply is expected to remain stable. Total demand is forecast to decline by 8% year-on-year to 237.0 tons, as the strong growth in exchange inventories and ETF accumulation seen in 2025 is unlikely to repeat. As a result, the market is projected to face a deficit of 7.5 tons in 2026.
Platinum's investment appeal is underscored by tight physical supply. At the start of 2026, platinum prices rose by 25%, reaching a record high above $2,700 per ounce in January—though still below the inflation-adjusted peak of over $3,400 per ounce. By late January, prices corrected alongside a pullback in gold but found support around $2,000 per ounce. This level is double the 2024 average price of $960 per ounce, reflecting strong fundamentals and macroeconomic factors supporting investor optimism. A sell-off in platinum, gold, and silver occurred in late January 2026 following the nomination of Kevin Warsh as Federal Reserve Chair. Although Warsh appeared supportive of near-term rate cuts, his reputation as an inflation hawk contributed to market adjustments. Nevertheless, geopolitical uncertainties—including proposed U.S. annexation of Greenland, political changes in Venezuela, domestic unrest in Iran, and ongoing conflict in Ukraine—continue to bolster precious metal prices. Macroeconomic conditions, including expectations of multiple U.S. rate cuts in 2026 and trade policies weighing on the U.S. dollar, also favor commodity and precious metal prices.
The platinum market continues to face structural tightness. Persistent deficits since 2023 have reduced above-ground stocks to unsustainable levels, supporting higher lease rates and strong spot premiums in over-the-counter markets. Industrial users have shifted from leasing to holding platinum in response to rising costs. Additionally, ongoing uncertainty related to the U.S. Section 232 investigation has contributed to platinum accumulation in exchange warehouses, particularly at the CME. While not yet included in 2026 forecasts, platinum inventories at the Guangzhou Futures Exchange could further tighten supply once data becomes publicly available in June 2026. The launch of platinum contracts on the exchange allows Chinese investors and end-users to hedge price risks in local currency, potentially boosting demand. Meanwhile, global demand for platinum bars and coins is expected to grow by 15% in 2026, reaching a new high.
In summary, investment demand remains a key driver of platinum market deficits. ETF holdings are expected to remain stable in 2026, contrasting with earlier forecasts of net selling. The cumulative deficit since 2023 has totaled 93.3 tons, highlighting sustained physical market tightness and reinforcing platinum's investment case amid ongoing macroeconomic and geopolitical uncertainties.
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