Pgm market report: February 2021

Key highlights 

Platinum 2020

• The platinum market remained in deficit in 2020, with sharply lower supplies, and strong investment demand.
• Autocatalyst consumption plunged by 22%, with steep falls in European diesel car production.
• Industrial purchasing was more resilient, especially in China, where petrochemical and glass expansions went ahead.
• Chinese jewellery demand slumped to a 20-year low, although record gold prices encouraged some retailers to stock more platinum.
• Japan saw heavy bar purchasing in the first half of 2020, while ETF investment turned strongly positive in the second half.
• Primary platinum supplies shrank by 20%, due to processing outages and pandemic-related disruption in South Africa.
• Auto recycling contracted sharply on weak diesel scrap volumes in Europe and processing capacity constraints.

Palladium 2020

• The palladium market remained in significant deficit, driving the price to all-time highs in early 2020.
• A plunge in vehicle output was partly offset by higher palladium loadings on gasoline vehicles.
• Consumption in chemical catalysts remained buoyant, with strong investment in new plants in China.
• Other industrial demand fell sharply, due to COVID-related disruption and price-driven thrifting.
• Investment demand remained negative, with further redemption of palladium ETFs.
• Primary supplies were hit by mine closures and processing outages, while autocatalyst recycling also slowed.

Rhodium 2020

• The rhodium market moved deeper into deficit as supplies dropped faster than demand.
• With tighter emissions limits boosting catalyst loadings, auto demand fell by less than 10%.
• Purchases by glass companies plunged, as high prices stimulated thrifting.
• Primary supplies contracted sharply due to mine disruption and processing outages in South Africa.
• The rhodium price surged to an all-time record of $17,000 in December 2020.

Outlook for 2021, all pgm

• Pgm supply and demand are forecast to bounce back in a V-shaped recovery in 2021.
• Autocatalyst demand will recover strongly, on higher car output and stricter emissions limits for trucks in China.
• Industrial consumption will remain robust, with pgm use in chemicals set to reach an all-time high.