WPIC: Platinum set for third year of deficit as industry demand surges

The World Platinum Investment Council (WPIC) said on 17 May that the global platinum market will be more undersupplied this year than it previously thought as economic recovery fuels a surge in demand from industry, says a Reuter report. 
Platinum is used by automakers, who embed it in vehicle exhausts to neutralise harmful emissions, by other industries such as glassmaking and for jewellery and investment.
The roughly 8 mn ounces a year market will see a shortfall of 158,000 ounces in 2021, the third consecutive annual deficit, the WPIC said in its latest quarterly report.
Three months ago it forecast undersupply of 60,000 ounces in 2021.
Consumption of platinum by industry and jewellers plunged last year as the coronavirus swept the globe, but the pandemic also disrupted supply and fuelled massive demand from investors looking for a safe place to put their money.
According to WPIC, that left the market undersupplied by 863,000 ounces in 2020, the biggest deficit on record. This year, demand from auto manufacturers and industry will rise above 2019 levels, with consumption by glassmakers in particular rocketing.
Jewellery demand will recover but remain below pre-pandemic levels, while purchases by investors will fall from last year's record but remain strong by historical standards. Supply will also rise but remain lower than in 2019.
WPIC says platinum fell to an 18-year low of $558 an ounce last year as the coronavirus spread. It has risen to around $1,200 but remains significantly below its highs between 2008 and 2014.
Many analysts and investors expect further price gains in the years ahead as demand, including from the nascent hydrogen industry and automakers switching to platinum from more expensive palladium, outpaces supply.

Aruna Gaitonde, Editor in Chief of the Asian Bureau, Rough&Polished