Why platinum group metals are less risky than their reputation suggests

Platinum group metals are often classified as ‘critical minerals’ – a term gaining increasing attention in recent years – alongside other materials that are (a) economically important and (b) have a perceived supply risk, typically due to geopolitical considerations. The economic importance of PGMs is becoming more widely understood, given their essential roles in technologies underpinning much of modern society, from aviation and pharmaceuticals to data centres and catalytic converters. But their supply profile has been misunderstood: while they are some of the rarest metals on earth, they are far more accessible than often perceived and can underpin sustainable solutions to many global challenges. A closer look at how PGMs are used, sourced, and recycled reveals the nuances that need to be considered.

The economic importance of PGMs

This first determinant of criticality, economic value, is generally underestimated for PGMs. Alongside the well-known uses in jewellery, catalytic converters and, more recently, in clean hydrogen technologies, PGMs are also integral parts of jet engines, electronic circuits, data centres, medical equipment, and are essential in the production of fuels, chemicals, pharmaceuticals, display glass and fibreglass, lithium-ion batteries, and the list goes on. Many of the products and technologies we rely on daily either contain a PGM or were made using one. 

In all these applications except jewellery, PGMs are used because they are the only material fit for the job: their unique properties deliver clear technical and economic performance benefits. Their cost-effectiveness is supported by their high recyclability, which is increasingly understood to also deliver sustainability benefits. In most applications, replacing PGMs with a non-PGM alternative means accepting significantly lower performance or higher operational cost, or doing without the technology altogether, all of which are rarely acceptable. Crucially, this applies not only to the current uses of PGMs, but to the emerging and potential ones too, underlining the need for R&D frameworks that allow researchers to fully explore the unique properties of PGMs.

Abundance does not mean secure or sustainable

Concerns about supply risk for PGMs pre-date current geopolitical tensions. Research, particularly in catalysis, has for some years pursued an expressed preference for ‘earth abundant metals’ rather than ‘rare metals’.[i] Metals such as iron, vanadium, nickel, and copper are seen as the safer and more sustainable choice because they are more geologically abundant relative to precious metals.

The fatal flaw in a blanket preference for earth abundant metals is that geological abundance, availability, and sustainability are three distinct metrics that do not correlate. Take rare earth elements as an example: they are at least as abundant as copper in the Earth’s crust, but are termed ‘rare’ because they do not occur in concentrated, easily mineable forms, limiting availability. [ii] And many ‘true’ earth abundant metals are listed as critical minerals precisely because the nature of their supply chains means their geological abundance does not translate into supply security. [iii] This is heightened by rapidly rising demand from energy transition applications, such as electric vehicles, battery storage, renewables and electricity networks, outstripping investment in exploration and processing infrastructure, with future copper availability looking particularly worrying on a global basis. [iv] The environmental sustainability of earth abundant metals must also be considered in light of the sometimes devastating impacts of rapidly expanding extraction. [v]

Let’s examine PGMs against this backdrop. Geologically very rare (or they would not be precious) and highly dependent on mining in South Africa, this has often led to the conclusion that their supply is risky and unsustainable and they should be avoided. 

To get a full understanding of the PGM supply risk profile, these are the important factors to consider: 

Geological occurrence: In contrast to rare earths, PGMs are exceptionally scarce in the Earth’s crust on average but happen to be concentrated in large, economically mineable deposits. The vast Bushveld Igneous Complex in South Africa contains enough PGMs to last for decades at current mining rates, given sufficient investment, and is typically mined by reputable companies who are highly regulated and ensure the metal is sourced responsibly. [vi] Overall, the occurrence of PGMs in the known and currently exploited deposits [vii] is generous enough that the economic case for additional exploration beyond these deposits is weak – and there is no case at all for deep-sea or asteroid mining for PGMs.

Diversification of sources: While PGM mining is highly dependent on South Africa, PGM availability is not only dependent on mining. Because of their high value, PGMs are extensively recycled in sophisticated networks around the world with high recycling rates (which are often underestimated due to misuse of market data). Once refined, recycled and mined PGMs are indistinguishable, and around 50–60% of PGMs used in new products is sourced from recycling, which is almost entirely conducted outside of South Africa. [viii] Substantial ‘urban mines’ of PGMs that are already in use can be recycled in future, and these occur all around the world thanks to inventories built up over decades of industrial use of these metals.

Maturity of supply chains: The decades of industrial use of PGMs, accompanied by recycling, mean that supply chains and processing infrastructure are mature and well-established in a global ecosystem, and are not dependent on one region. In fact, the entities most concerned about critical minerals also possess globally leading PGM supply chain capabilities: the UK, EU, US and Japan. The overwhelming focus on mined supply in the critical minerals debate has obscured these strengths.

Recycling: The maturity and high rates of PGM recycling have been driven by their value. Further improvements to boost recycling are of course still possible but will build incrementally on the established circularity of PGMs. [ix] This is true too for new technologies using PGMs: they can take advantage of an existing recycling network and have circularity built in from the start. Economic assessments often miss the impact of a closed-loop recycling solution, which dramatically reduces the cost of PGMs beyond the first lifecycle: if you recover the metal that you already own then you don’t need to keep buying it.

Evolving availability: The significant impact that established practices of PGM ‘thrifting’ and closed-loop recycling have on increasing PGM availability to enable new technologies is already well documented. [x] But there is a fundamental and unique shift afoot in the PGM markets. The largest application of PGMs, specifically platinum, palladium and rhodium, is in catalytic converters that are fitted to vehicles with internal combustion engines (including hybrids). Gradually, the amount of metal needed in this application will decline as battery vehicles take increasing share of the automotive market. This means more platinum, palladium and rhodium will be available for other applications, including (but not limited to) clean hydrogen. Much of this availability will be supplied by automotive catalysts themselves as vehicles are scrapped over coming decades and the PGMs are recycled. This presents an enormous opportunity for developing new applications of these metals. [xi]

Crucial, but not especially risky

On the first criterion of the critical minerals classification, economic importance, it’s clear that PGMs rate highly. Rating supply risk, however, is much more nuanced for PGMs. Indeed, with well-established mined supply, diverse sources for future recycling, mature and sufficient processing infrastructure in a number of countries, high recycling rates, and improving availability of platinum, palladium, and rhodium, PGMs have a relatively low supply risk compared to other critical minerals, ‘earth abundant’ or otherwise.

There are two takeaways:

Firstly, the assessment of PGM criticality should consider all aspects that contribute towards their future availability, including the role of recycling and their evolving market dynamics. The unique features of PGM supply chains, distinct from all other critical minerals, should be factored into policy to avoid unintended negative consequences. As a leading authority on PGM markets, JM is sharing much of our extensive knowledge to better inform these conversations.

Secondly, avoiding PGMs in R&D and new product development removes from the toolkit some of the most capable materials to address growing energy, environmental, and industrial challenges. This could limit the development of crucial technologies that we need for a viable future, with no benefit to supply risk or even sustainability. [xii] No supply chain is perfect, but PGMs offer a comparatively resilient one in a world increasingly affected by resource constraints. Putting that existing supply chain to best possible use is the most important consideration for PGMs.