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Platinum surplus vanishes as coronavirus hammers supply – WPIC

Thursday, September 10, 2020   (0 Comments)
Posted by: Matt Watson
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Platinum surplus vanishes as coronavirus hammers supply - WPIC

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The World Platinum Investment Council (WPIC) on Tuesday changed its forecast for the platinum market in 2020 from a surplus to a deficit, saying that the coronavirus outbreak would hammer supply even harder than demand.

 

LONDON, Sept 8 (Reuters) - The World Platinum Investment Council (WPIC) on Tuesday changed its forecast for the platinum market in 2020 from a surplus to a deficit, saying that the coronavirus outbreak would hammer supply even harder than demand.

The roughly 7.5 million-ounce market for the metal used in jewellery, vehicle exhausts and other industry will be undersupplied by 336,000 ounces – its second consecutive annual shortfall, the WPIC said in its latest quarterly report.

In May, it forecast at a 247,000-ounce surplus.

 

Changing the calculus were a steeper than expected fall in supply due to mine shutdowns, particularly in top producer South Africa, and a better than expected outlook for demand, particularly from investors.

Supply of platinum will fall to 7.1 million ounces in 2020 – down 14% from 2019, the WPIC said, with mine output in South Africa, where the government enforced a strict coronavirus lockdown, declining by one-fifth.

 

"Demand seems more likely to be better than worse," said Trevor Raymond, the WPIC's director of research, pointing to the speed of China's economic recovery this year and hopes for a similar rebound in Europe and the United States.

The WPIC revised upwards its forecasts for consumption by jewellers and industry, but particularly by investors, whom it said would gobble up 1.06 million ounces of platinum in 2020.

Platinum has attracted interest from investors who believe that precious metals will hold or increase their value through the coronavirus crisis and its aftermath.

 

However, while gold prices XAU= are up 27% so far this year at around $1,930 an ounce, platinum XPT= is down 6% at around $910 an ounce.

PLATINUM SUPPLY/DEMAND ('000 oz)*

SUPPLY

2020 (f)

2019

% change

Mine supply

5,187

6,097

-15%

Recycling

1,915

2,165

-12%

Total supply

7,102

8,261

-14%

DEMAND

Automotive

2,429

2,894

-16%

Jewellery

1,813

2,100

-14%

Industrial

2,136

2,140

0%

Investment

1060

1,252

-15%

Total demand

7,438

8,386

-11%

Balance

-336

-125

SUPPLY

Q2 2020

Q2 2019

% change

Mine supply

989

1,637

-40%

Recycling

419

520

-19%

Total supply

1,408

2,157

-35%

DEMAND

Automotive

386

747

-48%

Jewellery

392

540

-27%

Industrial

428

574

-25%

Investment

393

126

212%

Total demand

1,599

1,986

-19%

Balance

-191

171

* Source: World Platinum Investment Council, Platinum Quarterly Q2 2020


Read the full article t:  https://www.nasdaq.com/articles/platinum-surplus-vanishes-as-coronavirus-hammers-supply-wpic-2020-09-07


 

 

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