Platinum prices have soared by 20% year-to-date, reaching their highest levels since May 2023. Last Friday, the spot price of platinum hit USD 1,096.40 per ounce, marking a four-year high with a weekly gain exceeding 10%. This sharp rally is mainly fueled by a strong rebound in physical demand from China, rising concerns over supply shortages, and renewed investor interest in precious metals.
China’s demand has been a key driver behind the surge. Reports show a robust increase in purchases of platinum bars, coins, and jewelry. Despite platinum trading at a significant discount compared to gold, investors are attracted to the metal’s value. Analysts also highlight forecasted supply gaps, with some experts expecting a third consecutive year of supply deficits, potentially widening the global platinum shortfall.
Chinese Customs data reveals the magnitude of this demand surge. In April, China imported 10 metric tons of platinum, a 47% increase month-on-month, setting a 12-month record. Traders note that while many purchases are centered around the USD 950 per ounce price, any move beyond USD 1,000 might slow the current buying momentum.
The platinum rally is occurring alongside historic highs in gold prices, which recently touched USD 3,500.05 per ounce amid geopolitical tensions and strong central bank purchases. Despite challenges in the electric vehicle market—where platinum is critical for catalytic converters—the looming supply constraints and shifting investor strategies continue to boost platinum’s value. Other platinum group metals, such as palladium, have faced volatility due to recent changes in the automotive industry.
These trends highlight a dynamic shift in the global precious metals market. Recovering industrial demand in China, supply concerns, and evolving investment patterns are reshaping market fundamentals. The sustained rise in platinum prices reflects the delicate balance between industrial needs and speculative pressures, suggesting this momentum could influence market trends in the near future.
