First published by the World Platinum Investment Council
Platinum industrial demand has exhibited strong growth in recent years, at a compound annual growth rate (CAGR) of 6% between 2013 and pre-pandemic 2019.
This is significantly above the CAGR of two key industrial benchmarks, being more than double that of global GDP (gross domestic product) and triple that of industrial production as measured by the OECD (Organisation for Economic Co-operation and Development), over the same period.
In 2021, platinum industrial demand is expected to account for almost 40% of total platinum demand, net of recycling supply; unlike automotive and jewellery demand, consumption of platinum in industrial applications is usually expressed on a net basis, that is the gross demand less the supply of ‘closed-loop’ recycled metal.
As economic activity driving platinum’s industrial uses recovers, forecasts indicate that it will rebound by 25% year on year, to 2.4 moz. Significantly, this is also 13% higher than demand in pre-pandemic 2019.
China continues to be a major contributor to platinum’s industrial growth. For example, Chinese petroleum refining capacity has almost tripled over the last 20 years to keep pace with the rapid growth in domestic energy demand.
Latterly, the ambition for self-sufficiency in petrochemicals, a key part of China’s long-term social and economic policies, has seen strong demand for platinum catalysts in not only petroleum refining but also in the production of bulk chemicals such as paraxylene, propylene and hydrogen peroxide.
Globally, demand for platinum in the chemical and petroleum sectors is expected to recover well this year, rising by 11% and 65% respectively after the pandemic-related curtailment of activity in 2020.
This article was first published by the World Platinum Investment Council.