Pgm-market-report-February-2021

Pgm market report: February 2021

10 February 2021

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.

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.

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.

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.

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