Pgm Market Report: February 2019
We’ve recently published the February edition of our Pgm Market Report, giving an update on the supply and demand for the platinum group metals.
18 February 2019
Platinum outlook for 2019:
- The platinum market will remain in surplus in 2019, despite positive demand trends in automotive and industrial applications.
- The outlook for automotive platinum use is improving, due to stricter vehicle testing procedures in Europe and tighter emissions limits for heavy duty vehicles in China.
- Industrial consumption of platinum will be supported by the ongoing construction of several large integrated petrochemical complexes in China.
- The prospects for Chinese platinum jewellery demand are negative, due to increased competition from karat gold products, and increased recycling of old platinum jewellery.
- Supplies from South Africa will be supported by the refining of in-process stocks, helping to offset shaft closures.
Palladium outlook for 2019:
- Strong growth in autocatalyst demand will drive the palladium market further into deficit in 2019.
- Stricter emissions legislation and more stringent vehicle test procedures are forecast to stimulate double digit rises in palladium demand from European and Chinese automakers.
- Industrial demand will remain firm, with continuing strong demand from the Chinese chemical sector.
- Recycling is forecast to rise again, but there is little prospect of growth in primary supplies.
- Remaining Exchange Traded Fund (ETF) holdings are no longer sufficient to bridge the gap between industrial demand and supplies.
Rhodium outlook for 2019:
- Rhodium use in autocatalysts is set to grow strongly in 2019, as car companies increase catalyst loadings in response to tighter legislation and more stringent in use testing.
- This should outweigh thrifting in the glass industry, which is expected to reduce the rhodium content of some platinum glass making alloys.
- Primary supplies are expected to be flat, as South African producers refine excess pipeline inventory, while there should be further growth in recycling.
- The market could remain in a technical surplus, but any improvements in availability are likely to be absorbed by rising automotive demand and, potentially, strategic purchasing.