The experts from the World Platinum Investment Council (WPIC) have improved their forecast for the palladium market. According to a new report made by the organization, the global palladium shortage could continue until at least 2026.
According to the WPIC’s previous forecast, palladium shortage of 1.3 mn ounces was expected this year. The deficit was expected to decrease to 200 thousand ounces by 2025, and the palladium market would show a sustained oversupply from 2026.
However, this scenario assumes that the current pace of the electric vehicle market development will continue, as well as a significant increase in palladium recycling. In reality, the growth rate in sales of electric vehicles is already showing signs of a slowdown, and hybrid vehicles are gaining popularity.
As a result, the WPIC analysts predict the transition of the palladium market to a surplus in 2027 at the earliest. Demand for the metal in the automobile manufacturing sector is expected to decline by maximum 1 percent annually. Moreover, the process of replacing platinum with palladium may begin, given the difference in prices for these metals.
Mathew Nyaungwa, Editor in Chief of the African Bureau, Rough&Polished
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