After a prolonged period of underperformance, the platinum market is showing early signs of a potential bull run. Since hitting a low in April 2025, platinum has surged over 55%, rekindling investor interest and sparking debates among analysts: is this a short-lived spike or the start of a long-term upward trend?
Historical Platinum Price Trends: Learning from the Past
To understand the current platinum market, it's helpful to look at historical performance. Platinum's most notable bull markets occurred in the 1970s and 2000s, both of which were marked by wider commodity rallies and powerful demand catalysts. In the 1970s, the oil crises of 1973 and 1979 sent shockwaves through global markets, and the introduction of platinum-based autocatalysts in vehicles in 1975 added further fuel to the metal’s price surge. The result was a series of market deficits and a dramatic rise in value.
In the 2000s, China’s rapid industrialisation and its introduction of tailpipe emissions standards in 2000 led to a fourfold increase in Chinese demand for platinum autocatalysts over the next decade. The European diesel boom also contributed significantly to platinum consumption during this time.
By indexing platinum prices by decade, it becomes evident that major bull markets were typically tied to larger commodity cycles and structural demand shifts.
Recent Rally: A Flash in the Pan or Sustainable Growth?
So far in 2025, platinum has been catching up with the gains seen in gold and palladium. While gold and copper have approached record highs, other industrial commodities have remained relatively flat. Oil prices are being suppressed by sluggish demand growth and increasing production from OPEC+. Base metals like nickel and zinc have also seen muted performance, weighed down by macroeconomic uncertainty and weak Chinese consumption.
In contrast, platinum has stood out, surging by over 55% since April. However, the rally’s sustainability is being questioned, as fundamental demand indicators remain mixed. Key sectors such as automotive and jewellery, which account for a large share of platinum use, are not showing the same clear growth drivers that supported previous bull runs.
Platinum Price in Euros
Automotive Demand Under Pressure
One of the major headwinds for platinum demand lies in the automotive sector. Battery electric vehicles (BEVs) are gaining global market share, reducing the demand for internal combustion engines (ICEs) that use platinum-group metals (PGMs) in autocatalysts. While the hydrogen economy could potentially emerge as a new demand pillar for platinum, adoption remains in its infancy, with infrastructure development and fuel cell vehicle penetration still limited.
China’s slowed economic growth, combined with rising trade tensions and tariff uncertainties, also casts doubt on the future strength of industrial platinum demand.
Supply Constraints: South African Output Under Pressure
While demand is uncertain, the supply side of the platinum equation is tightening. South Africa, which accounts for the vast majority of global platinum production, experienced significant disruption at the start of 2025. Heavy rainfall affected several major mining operations, including those run by Tharisa, which revised its full-year guidance down by 5% to 133,000 ounces of 3E PGMs.
Although Tharisa is a relatively small PGM producer compared to larger players like Sibanye-Stillwater or Anglo American Platinum, the overall trend across South African producers suggests a challenging year ahead. Global platinum output in 2024 stood at 5.5 million ounces, and it is expected to fall by around 4% in 2025 due to ongoing operational issues in South Africa and reduced by-product output from North America.
These production cuts could provide a floor under platinum prices, especially if demand begins to stabilise or grow.
Investment and Jewellery Demand: Early Signs of Recovery
Jewellery demand for platinum has also experienced significant fluctuations. In China, which was once the world's largest consumer of platinum jewellery, demand has declined sharply over the past decade—from nearly 2 million ounces to just 390,000 ounces in 2024. However, early 2025 data is showing a reversal in this trend.
According to Platinum Guild International (PGI), jewellery fabrication in China rose 50% year-on-year in Q1 2025, spurred by favourable price differentials between platinum and gold, along with changing consumer preferences. Retail sales, however, have not kept pace, rising just 16% among PGI's partner network.
This disconnect between fabrication and retail sales suggests that while manufacturers are optimistic about platinum jewellery’s rebound, actual consumer demand is still tepid—perhaps a reflection of broader economic weakness in China's luxury goods sector. For example, gold jewellery sales in Q1 2025 fell to a five-year low, indicating a general decline in appetite for high-end jewellery across metals.
Platinum vs Gold: Price Gap Narrows
For much of the past decade, platinum has traded at a deep discount to gold. This price gap had made platinum jewellery an attractive alternative to both yellow and white gold, particularly in markets sensitive to price.
However, as platinum prices have rallied in recent weeks while gold has remained relatively stable, that discount has narrowed. This could limit the competitive advantage that platinum jewellery previously enjoyed, especially in price-sensitive markets like China and India.
Technical Resistance and Market Sentiment
Last week, platinum prices recorded their first weekly loss in six weeks, falling 0.6% to $1,385/oz after failing to break through a key technical resistance level at $1,400/oz. This level represents the 50% Fibonacci retracement from the 2011 peak and is seen as a significant psychological barrier for traders and investors alike.
While short-term momentum has stalled, breaking through this resistance could trigger a fresh wave of institutional buying and renewed confidence in platinum’s long-term potential.
Outlook: Is This the Start of a New Bull Market?
Platinum’s recent rally has reignited interest in the metal, but the sustainability of the bull run hinges on several factors:
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Supply disruptions in South Africa could continue to support prices.
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Investment demand may increase if platinum’s discount to gold stabilises or narrows further.
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Jewellery demand in China is showing early signs of recovery, but must be sustained.
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Hydrogen economy developments could offer long-term structural demand growth.
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Automotive sector remains a concern due to the global shift towards BEVs.
If historical patterns hold true, and the current rally is indeed the start of a new commodity cycle, platinum could have much more room to rise. While the fundamental picture is not yet entirely clear, supply tightness and technical price momentum may be enough to carry platinum higher in the near term.
