Platinum is on a meteoric rise! The ten consecutive increases broke through $2300 per ounce, sparking market imbalance between supply and demand.

Driven by multiple factors such as supply shortages and demand resilience, platinum prices have soared to new historical highs. As of the time of writing, the spot price of platinum has risen by 2.6%, reaching $2355.61 per ounce, breaking through the $2300 per ounce mark for the first time. At the same time, this marks the tenth consecutive trading day of increase for platinum, setting a record for the longest continuous rise since 2017. Platinum spot prices have risen by over 23% in the past week, over 52% in the past month, and nearly 150% year-to-date. Analysts point out that this current rally in platinum prices is well supported by solid fundamentals. On the supply side, the main platinum-producing country, South Africa, continues to face structural issues such as power shortages and aging infrastructure in its mining areas. Due to underinvestment, platinum group metal production in South Africa fell by 13% year-on-year in the first quarter, with an expected 6% decrease in production for the full year 2025. Data from the World Platinum Investment Council (WPIC) further supports bullish sentiment, forecasting a third consecutive year of shortages in the global platinum market by 2025, with a possible shortfall of up to 30 tons. On the demand side, increasing usage of traditional automotive catalytic converters combined with growth in the hydrogen energy industry have boosted demand for platinum. Traditional automotive catalytic converter demand has shown unexpectedly strong resilience. Despite the rapid development of electric vehicles, the existing and future numbers of fuel-powered vehicles globally remain significant, and stricter emission regulations require an actual increase in platinum usage per vehicle. The decision by Europe to relax the 2035 ban on fuel-powered vehicles further strengthens the automotive industry's expectations for platinum demand. Additionally, the rise of the hydrogen energy industry has opened up a new growth path for platinum. China's "15th Five-Year Plan" positions hydrogen energy as a "key chess piece," and as an irreplaceable catalyst in fuel cells and electrolysis of water for hydrogen production, platinum's strategic value is being recognized once again. The potential for this emerging demand is immense and may become a medium to long-term price support for the metal. The "substitution effect" triggered by high gold prices cannot be ignored. Gold prices have been steadily rising this year, making platinum, which offers better value for money, an alternative choice for many consumers and investors, resulting in a significant increase in demand. Data released by the World Platinum Investment Council shows that platinum jewelry demand is expected to increase by 7% to 67 tons in 2025, the highest level since 2018; investment demand is projected to increase by 6% to 23 tons. It is worth noting that the Chinese market has become a core driver of demand for platinum bars and coins platinum bar and coin demand in 2025 is expected to increase by 47% to 16 tons, reaching a four-year high. As an indicator of the tightness of the spot market, the one-month platinum lease rate has recently risen to high levels. This phenomenon usually indicates a scarcity of metal available for lending in the spot market, leading industrial users to purchase metal directly on the market rather than borrow, thus driving up spot premiums. This scarcity, coupled with changes in NYMEX inventories and increasing global ETF holdings, constitutes "paper evidence" of the resonance between futures and spot prices. In fact, in addition to platinum, other precious metals such as gold, silver, and palladium have also shown impressive performances recently. Gold spot prices have risen by over 8% in the past month, briefly breaking $4500 per ounce on Wednesday; silver spot prices have surpassed $70 per ounce, hitting a new all-time high; palladium spot prices have risen to $1883 per ounce, an increase of approximately 35% in the past month, and over 13% in just the past week. Analysts point out that behind this current bull market in precious metals are a combination of factors including expectations of macroeconomic easing, tight spot supply, demand resilience, and resonance within the precious metals sector. The weakening US dollar and rising expectations of Federal Reserve interest rate cuts, particularly the bet on Kevin Warsh possibly being nominated for Fed chair, have lowered US bond yields and the cost of holding precious metals. UBS analyst Giovanni Staunovo states that strong investor demand, continued central bank buying, and expectations of lower rates in 2026 are supporting precious metal prices. Against the backdrop of global competition for key resources, the pricing of "money" and "resources" is undergoing a rebalancing, with platinum and palladium as members of the precious metals sector having strong production constraints and high monopolization on the resource side. Looking ahead, considering the continuous historical highs in gold and silver prices, there may still be room for future price increases in platinum and palladium. Market participants believe that the strong trend in platinum is likely to continue. On one hand, the tight supply and demand situation for platinum is unlikely to improve in the short term, and with the continued development of the hydrogen energy industry, the industrial demand for platinum is expected to further expand, potentially widening the supply-demand gap. On the other hand, under the logic of investors seeking cost-effective assets, the valuation advantage of platinum over gold may continue to attract follow-up investment. However, some analysts caution that the ability of platinum and palladium prices to maintain their strength mainly depends on several key variables: whether lease rates and spot premiums can remain at high levels, whether the macro direction of gold/dollar/interest rates continues to be favorable, and the speed of supply-side recovery and the release of "above-ground stocks." If lease rates fall from their high levels and the tight spot situation eases, platinum futures may enter a period of consolidation or retracement. A reversal in gold weakness or interest rate expectations could also put pressure on platinum, especially in the current high volatility environment. In addition, some traders and analysts warn that while there is a tight supply of platinum at the mine level, there are still significant above-ground stocks globally. Data from Metals Focus shows that even considering supply deficits, total stock levels may be equivalent to approximately 14 months of demand, providing a considerable cushion. The possibility of supply recovery cannot be overlooked. South African mining production is expected to show signs of recovery after the second quarter of next year, with the full-year production decline expected to be around 6%. Furthermore, the high platinum prices may trigger material substitution risks when the platinum-palladium price difference exceeds 30%, catalyst manufacturers may increase the proportion of palladium used.