According to a report by Johnson Matthey, the platinum market is expected to face its largest supply shortfall in 10 years in 2024. The autocatalyst maker said it expects all platinum group metals (PGMs) – platinum, palladium, and rhodium – to remain in deficit next year.
Johnson Matthey (JM) forecasts the platinum market’s deficit to increase to 598,000 ounces in 2024, up from a shortfall of 518,000 ounces in 2023. This is due to a combination of stable demand and a decline in primary supply as Russian shipments return to more normal levels following heavy selling of mined stocks in 2023.
Platinum demand is expected to stabilize at around 7.61 million ounces, with small decreases in automotive and jewelry demand offset by an uptick in investment. Meanwhile, auto sector platinum consumption is projected to slip 1.3% in 2024.
For palladium, JM expects demand from automakers to fall by about 7%, reducing overall demand to 9.73 million ounces and cutting the market deficit to 358,000 ounces from 1.02 million ounces last year.
The rhodium market is also forecast to be undersupplied, but to a lesser degree, with a deficit of 65,000 ounces, down from 125,000 ounces in 2023. Rhodium auto consumption is expected to decline by around 6%, contributing to the lower deficit.
Rupen Raithatha, market research director at Johnson Matthey, explained that automotive and industrial users had bought more PGMs than they needed during 2020-2022 to mitigate price and supply risks. Since then, consumers have been using up excess PGM inventory, and some have even sold metal back to the market.
The expected supply deficits across the PGM complex highlight the ongoing tightness in these critical raw materials, which are essential for the automotive industry and various other applications.