Platinum has been quietly building a bullish case, with supply deficits widening and industrial demand growing. While gold and silver have captured most of the headlines, platinum may offer the most compelling risk-reward opportunity in the precious metals complex.
Supply Deficit Widens
The World Platinum Investment Council (WPIC) forecasts a significant supply deficit for the fourth consecutive year. South Africa, which produces approximately 70% of the world’s platinum, continues to face operational challenges including aging mine infrastructure, labor disputes, and rolling power outages (load shedding).
New mine development has been minimal, with long lead times and high capital costs deterring investment. Recycling, the second-largest source of platinum supply, has also been below expectations.
Hydrogen Economy Potential
Platinum’s role in the hydrogen economy represents a potentially transformative demand driver. Proton exchange membrane (PEM) fuel cells used in hydrogen vehicles and industrial applications require platinum as a catalyst.
As governments worldwide invest in hydrogen infrastructure as part of their clean energy transitions, platinum demand from this sector could grow significantly over the next decade.
Investment Case
At current prices, platinum trades at a historic discount to gold — a relationship that has persisted for several years but may be unsustainable. The platinum-to-gold ratio suggests significant undervaluation relative to historical norms.
Investors looking for precious metals exposure with turnaround potential may find platinum an attractive option at current levels.