The World Platinum Investment Council (WPIC) stated on November 22, 2022, that it expects a deficit of platinum, which is used in industry, jewelry, and automotive exhausts, in 2023 after a substantial surplus in 2022. According to the report, demand would increase by 19% to 7.77 million ounces in 2023, the highest level since 2020, as consumption by automakers would increase and investors would switch from net sellers to net purchasers. The global market volume of platinum production increased significantly in 2022 and would increase further in 2023, according to GlobalData.
The global market volume of platinum consumption also increased significantly in 2022 and would increase further in 2023, according to GlobalData.
Power disruptions and maintenance at mines in South Africa, the world's top producer of platinum, limited the supply, resulting in a 303,000-ounce shortfall in 2019. In addition, the WPIC forecast that the market surplus in 2022 would be 804,000 ounces instead of the 974,000 ounces it predicted in its quarterly report in September 2022. An increase in vehicle manufacturing and stricter rules demanding more metal in exhaust systems to neutralize emissions are contributing to the demand in the auto industry.
To save money, manufacturers are also shifting to platinum, which is cheaper than palladium. According to the WPIC, this substitution will account for 340,000 ounces of platinum demand in 2022 and marginally over 500,000 ounces in 2023. Purchases of platinum bars and coins would increase by 49% in 2023 as demand from Japan increases, but metal withdrawals from exchange-traded funds and exchanges would noticeably slow down, according to the WPIC.
As consumption by glassmakers increases by 52%, it was predicted that demand from industries will be the second-highest on record in 2023. Despite an excess, China has been importing 2.5 million ounces of platinum since the beginning of 2021, according to the WPIC. Because it is unknown when or how these commodities are used, they are excluded from the WPIC's data on demand.
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