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.
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.
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