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Platinum Market Forecast
Platinum Supply To Grow By Global platinum supplies are forecast to climb by 110,000 oz to a total of 6.06 million ounces. In South Africa, a mixture of safety issues, shaft closures and industrial unrest have led to a reduction in tonnes of ore milled by the industry. However, the sale of additional metal from refined stocks means that South African supplies will rise by 210,000 oz in 2009 to 4.73 million ounces. Platinum supplies from North America and Russia are set to fall to 255,000 oz and 745,000 oz respectively. Autocatalyst Platinum Demand To Fall By A Third To 2.48 Million Ounces.
Net Jewelry Demand To Rise By Almost 80 Per Cent To An Annual The lower platinum price has reignited demand in the Chinese jewelry sector, encouraging the industry to replenish and further build its stocks, particularly in the first half of 2009. Improved profit margins have attracted new manufacturers and retailers into platinum jewelry while a lower retail price has driven consumer purchases higher. As a result, demand in China is forecast to leap by 900,000 oz to a record 1.75 million ounces in 2009. Net Japanese jewelry industry demand for platinum has risen as the fall in the platinum price has depressed recycling volumes from second hand jewelry. Demand from European and U.S. jewelers has declined due to the impact of the recession on consumer sales. Platinum Expected to Trade Between 2010 will bring some recovery in automotive and industrial demand for platinum as the world economy improves, but supplies are not likely to grow to the same extent and the market could move into a modest deficit. These positive fundamentals will support the platinum price. Much of the price rise over the last twelve months has been driven by a weak Dollar, a strong gold price and by growing investor interest and if these trends continue the price may trade as high as $1,550 during the next six months. However, if the Dollar strengthens, or the price of gold falls, then the platinum price could fall as low as $1,280 during the same period.
Palladium Market Forecast Net global palladium demand is forecast to decline by 3.8 per cent to 6.52 million ounces this year according to Johnson Matthey. Autocatalyst demand will be depressed by lower light duty vehicle production in most regions. Electronics, dental and chemical sector purchases are also set to fall due to the effects of the economic slowdown. However, the low palladium price will boost physical investment demand and jewelry demand will rise slightly. Total supplies of palladium, including the sale of 960,000 ounces from Russian state stocks, are expected to fall by 1.8 per cent to 7.18 million ounces. The palladium market is therefore forecast to be in oversupply in 2009 by 655,000 ounces. Total Supplies Of Palladium Expected To Decline To 7.18 Million Ounces. Palladium supplies are forecast to shrink by 135,000 oz to 7.18 million ounces in 2009. Sales from primary production in North America and Russia are set to decline. Palladium sales from South African producers are forecast to rise, despite a decrease in underlying production of palladium in concentrate. Sales of palladium from the remainder of the Russian state stocks, previously shipped to Switzerland, are expected to contribute a further 960,000 oz to supplies. Gross Palladium Autocatalyst Demand Forecast To Fall To 3.90 Million Ounces Despite Robust Performance In China And Europe. Gross palladium demand for use in catalytic converters is expected to decrease by 12.7 per cent to 3.90 million ounces in 2009. Demand in Japan, North America and the Rest of the World region will fall, in line with lower light duty vehicle production. Strong growth in domestic vehicle sales is likely to boost Chinese demand by some 135,000 oz this year. European demand is forecast to fall only marginally as palladium benefits from a short term rise in the market share of the gasoline engine and its steady introduction into diesel exhaust aftertreatment. Net Palladium Jewelry Demand To Rise To 920,000 Ounces. Net jewelry sector demand for palladium is expected to increase in every region in 2009. Palladium continues to make steady progress as a jewelry metal in Europe and North America. The Chinese jewelry market appears to have stabilized and demand there will rise to 680,000 oz as recycling rates decline. Palladium Set To Trade Between $290 The existence of a surplus in the palladium market has weighed on the price over recent years. However, investors seem aware of the imbalance between demand and current mine production and are bullish for the palladium price over the longer term. Demand for palladium will benefit from a recovery in vehicle production volumes and if the funds continue to invest the palladium price could rise to $390 during the next six months. However, any weakness in gold and platinum prices or a strengthening of the Dollar may undermine the price with possibility that palladium could trade down to $290 during the same period. |
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Net global platinum demand is forecast to decrease by 4.4 per cent to 5.92 million ounces in 2009, according to Johnson Matthey's "Platinum 2009 Interim Review". Gross autocatalyst demand is set to drop by a third to 2.48 million ounces due to cuts in vehicle production in most regions. Industrial demand will fall due to soft consumer demand and destocking of products and materials in many sectors. The lower price of platinum is expected to boost jewelry and physical investment demand to 2.45 million ounces and 630,000 ounces respectively. Platinum supplies are expected to increase by 110,000 ounces to 6.06 million ounces despite a fall in underlying mine production. As a result, the platinum market is forecast to be in surplus by 140,000 oz in 2009.
Gross autocatalyst platinum demand is forecast to decline by 33.0 per cent to roughly 2.48 million ounces in 2009. European autocatalyst demand for platinum is expected to fall by 45.7 per cent, or 900,000 oz, to 1.07 million ounces. The effect on demand of a sharp reduction in vehicle production has been exacerbated by a short term decline in the market share of diesel passenger cars. Demand will fall in Japan, North America and the rest of the World region reflecting a fall in vehicle production volume in each area. Chinese platinum autocatalyst demand will rise due to a strong performance by the automotive sector there.
