The platinum market recorded a modest deficit of 11,000 ounces (koz) in the second quarter of 2025, according to the World Platinum Investment Council (WPIC).
This occurred against a backdrop of a significant 37% increase in platinum prices.
The report seen by Rough&Polished shows that both supply and demand fell compared to Q2 2024, with total supply down 4% and total demand down 22%.
The decline in supply was primarily driven by an 8% year-on-year drop in mine production, notably from South Africa and Russia, though this was partially offset by a 12% rise in recycling.
The sharp drop in demand was largely attributed to a significant reduction in exchange stocks and lower investment, which overshadowed robust growth in jewellery fabrication.
For the full year 2025, the market is forecast to be in a deficit of 850 koz, a reduction from the previous forecast of 966 koz.
This revision is due to strong Chinese demand upgrades for jewellery and investment being more than offset by a substantial downward revision to industrial demand, particularly in the glass sector.
Total supply is expected to fall 3% for the year, with mine supply down 6% and recycling up 6%. Meanwhile, total demand is projected to decline by 4%.
Key dynamics included elevated lease rates, the impact of US tariff exemptions for unprocessed platinum, and a surge in Chinese demand for jewellery and small bars/coins driven by platinum's widening discount to gold.
Automotive demand proved resilient, declining only 2% despite challenges.
Below are key excerpts from the report.
What was the platinum supply and demand during the second quarter (Q2) of 2025 compared to the same period in 2024?
During Q2 2025, both platinum supply and demand decreased compared to Q2 2024. Total platinum supply declined by 4% year on year due to an 8% year-on-year decline in mine supply (- -123 koz), which was partially offset by a 12% year-on-year increase in recycling (+44 koz). Highlighting the magnitude of the impact of flooding during Q1 in South Africa, the country's mine supply bounced back by 48% quarter-on-quarter in Q2 2025 but was still down 6% year-on-year. Russian production decreased by 14% year-on-year as a new OEM's equipment and vehicle fleet were incorporated into the mining operations. Higher automotive and jewellery recoveries drove recycling supply growth. Total platinum demand decreased by -22% year-on-year (-544 koz) in the second quarter. Higher jewellery fabrication was broadly netted off by declining automotive and industrial demand. However, the primary segment underpinning lower platinum demand in the second quarter was investment. Total investment holdings decreased by 64 koz in Q2 2025, compared to a 459 koz increase in Q2 2024. Investment demand was negatively impacted by a -317 koz reduction in platinum stocks held on exchange. In aggregate, the platinum market recorded a modest 11 koz deficit during Q2 2025.
How is the platinum supply expected to perform by the end of 2025?
Platinum supply is expected to decline by -3% year-on-year in 2025. Depressed supply follows expectations for a -6% year-on-year reduction in mining output as South African producers will not be able to repeat the large drawdown of work-in-progress inventory that occurred last year. In contrast to mining, the recycling supply is expected to rise by 6% year-on-year. Forecast recycling supply growth has been revised upward from 3% year-on-year growth previously due to higher prices incentivising more spent auto catalyst processing and jewellery sellbacks. Turning to demand and first looking at revisions since our last platinum quarterly, strong Chinese demand has led to upgrades to jewellery (increased by 111 koz) and investment (up by 30 koz) demand expectations for 2025. However, these have been more than offset by a downward revision of 210 koz to industrial platinum demand expectations in 2025.
What are the key reasons for the decrease in the forecast 2025 deficit from the May 2025 report?
The forecast platinum market deficit for 2025 has decreased from the 966 koz reported in the May 2025 Platinum Quarterly, primarily due to an upgrade to jewellery demand expectations being more than offset by downward revisions to industrial platinum demand.
Why is South African mine supply projected to decline in 2025?
South African mine output is projected to fall by 6% year-on-year in 2025, to 3,869 koz... primarily due to the depletion of semi-finished inventory at Valterra Platinum that had boosted refined output in 2024.
Which region is expected to see the largest percentage decline in mine supply, and why?
In North America, output is forecast to slump by 26% year-on-year to 189 koz... This downturn stems from Sibanye-Stillwater’s restructuring of its US assets, coupled with reduced production from Canadian nickel by-product operations, which face margin pressure.
What is the overall forecast for total platinum demand in 2025?
Total platinum demand is expected to decline by 4% year-on-year in 2025 to 7,877 koz.
Which demand segment is expected to see the largest absolute decline in 2025, and what is the main driver?
Industrial demand has the largest negative impact [on] total demand in 2025, with the glass segment facing a cyclical slowdown in new capacity additions, which is leading to a 74% year-on-year reduction in demand (-515 koz).
Which two demand segments are forecast to grow in 2025, and by how much?
Jewellery demand is forecast to increase by 11% year-on-year, while investment demand is up 2% year-on-year for 2025f.
What was the standout performer in Chinese demand during Q2 2025, and what were the figures?
In Q2 2025, China’s platinum jewellery fabrication increased over two-fold versus a year earlier and platinum bar and coin (<500g) demand increased by over six-fold.
What happened to platinum lease rates in Q2 2025, and what was the market's reaction?
Three-month lease rates were elevated, averaging between 6% to 16% through Q2, well above the average lease rate of 1% to 3% seen through 2024... the market eventually showed some response to price appreciation of ~50%, with net ETF sales of 231 koz in July.
What was the significant price movement for platinum in Q2 2025?
A significant focus of the second quarter of 2025 was the 37% increase in platinum prices over the three months to June.
What was the impact of US tariff policies on platinum?
Subsequently released details highlighted that most unprocessed platinum imports (sponge, grain, ingot, etc.), as well as legal tender coins, would be exempt from tariffs. Platinum minted bars were not exempt from tariffs.
What happened to exchange stocks in Q2, and what was the subsequent trend?
Platinum stocks held on exchange decreased by -317 koz through Q2 2025... In July, restocking resumed as the US imposed tariffs on copper and reaffirmed 30% tariffs on South Africa, reigniting traders’ concerns and prompting renewed demand for US-located metal.
How did automotive platinum demand perform in Q2 2025 despite challenges?
Automotive demand proved resilient, contracting only 2% year-on-year despite significant tariffs on vehicles and parts.
What was the primary reason for the surge in Chinese jewellery fabrication in Q2?
Faced with higher financing costs from rising gold prices, lacklustre retail sales, and a prevailing view that platinum was undervalued, many Shenzhen showrooms undertook aggressive inventory building.
What is the forecast for palladium substitution with platinum in 2025?
Substitution of palladium with platinum is expected to peak at 845 koz in 2025.
Mathew Nyaungwa, Editor-In-Chief, Rough & Polished
