When we look at the platinum supply and demand, things are getting worse for platinum. The automotive demand has been going down sharply and we are in platinum surplus now.
But the price of platinum is now at $800/ounce, which means that a lot of producers are having losses. Lonmin and Impala are going to go bankrupt in a year from now. That means that we will see around 2 million ounces less production, which will put the supply and demand balance back into deficit. Platinum price will need to go up.
Moreover, there is one interesting development. Fuel cell cars are going to hit the market in the coming years and they need platinum. So I see platinum demand to go back up due to fuel cell cars in the coming decade. But this depends on market penetration, if the industry decides fuel cell cars are not the future, then the outlook for platinum will be dire.
Conclusion, it is a good time to get into the physical platinum market. Go buy a platinum ETF.
But the price of platinum is now at $800/ounce, which means that a lot of producers are having losses. Lonmin and Impala are going to go bankrupt in a year from now. That means that we will see around 2 million ounces less production, which will put the supply and demand balance back into deficit. Platinum price will need to go up.
Moreover, there is one interesting development. Fuel cell cars are going to hit the market in the coming years and they need platinum. So I see platinum demand to go back up due to fuel cell cars in the coming decade. But this depends on market penetration, if the industry decides fuel cell cars are not the future, then the outlook for platinum will be dire.
Conclusion, it is a good time to get into the physical platinum market. Go buy a platinum ETF.
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