Platinum market faces million-ounce deficit in 2024, WPIC says

* Platinum market faces second year of deficit in 2024, WPIC says * Supply seen down 1% in 2024 with lower mine production * Demand seen up 3% in 2024 after 22% growth in 2023 LONDON, Sept 10 (Reuters) – The global platinum deficit in 2024 will be twice as high as previously expected due to inflows to exchange-traded funds and purchases of large bars in China, the World Platinum Investment Council said on Tuesday. Investment demand will climb 15% as holdings of global physically backed platinum ETFs, which store the metal for investors, rise, the WPIC said in a quarterly report. It now expects the global platinum market to show a shortfall of 1.0 million troy ounces this year, compared with a previously projected deficit of 476,000 ounces. Purchases of platinum bars of 500g or more in China – a category of investment demand which the WPIC added to its estimates for the first time – are expected to rise by 40% to 188,000 ounces this year. As relatively low prices for platinum and its sister metals palladium and rhodium continue to weigh on the mining industry, the WPIC, whose members are major Western platinum producers, expects mine supply to fall 2% due to lower South African production in 2024. This will be partly offset by 2% growth in recycled supply. Meanwhile demand from the auto sector, which uses platinum in catalytic converters to reduce harmful emissions from vehicle exhaust systems, is on track to rise 1% to a seven-year high of 3.2 million ounces. That is due to growth in hybrid vehicles sales, stricter emissions legislation, and platinum-for-palladium substitution, which is forecast to reach 752,000 ounce this year, the WPIC, which uses data from consultancy Metals Focus, added. To cover the deficit, above-ground stocks will fall by 25% to a four-year low of 3.0 million ounces, equal to about four months of global demand, it said. PLATINUM SUPPLY/DEMAND (‘000 oz)* 2022 2023 2024f 23/22 24/23 Q2 2023 Q1 2024 Q2 2024 change change SUPPLY Refined production: 5,520 5,604 5,508 2% -2% 1,486 1,224 1,540 – South Africa 3,915 3,957 3,883 1% -2% 1,051 794 1,126 – Zimbabwe 480 507 504 6% -1% 126 132 125 – North America 263 275 273 5% -1% 73 71 61 – Russia 663 674 646 2% -4% 190 178 181 – Other 200 190 203 -5% 7% 46 48 48 Change in producer +43 +11 0 +8 +9 +30 inventory Total mining supply 5,563 5,615 5,508 1% -2% 1,494 1,233 1,570 Recycling: 1,764 1,545 1,581 -12% 2% 383 377 388 – Autocatalyst 1,323 1,144 1,161 -14% 2% 290 275 297 – Jewellery 372 331 344 -11% 4% 76 85 72 – Industrial 69 71 76 3% 8% 17 17 19 TOTAL SUPPLY 7,327 7,160 7,089 -2% -1% 1,877 1,610 1,958 DEMAND Automotive 2,769 3,215 3,237 16% 1% 814 822 820 Jewellery 1,899 1,868 1,994 -2% 7% 478 484 501 Industrial: 2,315 2,356 2,369 2% 1% 663 627 638 – Chemical 673 786 542 17% -31% 233 145 122 – Petroleum 193 158 153 -18% -3% 40 38 38 – Electrical 106 89 90 -16% 1% 23 22 23 – Glass 505 432 635 -14% 47% 146 195 216 – Medical 278 292 303 5% 4% 72 72 77 – Hydrogen stationary 12 29 64 133% 123% 5 12 14 – Other 548 571 582 4% 2% 145 142 148 Investment: -516 451 517 N/A 15% 195 117 462 – Change in bars/coins 259 323 180 25% -44% 47 64 17 – China bars 500g+ 90 134 188 49% 40% 20 53 41 – Change in ETF -558 -20 150 N/A N/A 155 11 444 Holdings – Change in stocks -307 14 0 N/A -27 -11 -40 held by exchanges TOTAL DEMAND 6,467 7,892 8,118 22% 3% 2,151 2,051 2,421 Balance 860 -731 -1,028 -273 -441 -464 Above ground stocks 4,765 4,034 3,006 -15% -25% Source: Metals Focus 2020–2024 via WPIC (Reporting by Polina Devitt; Editing by Jan Harvey)

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