Platinum supply to outstrip demand

Supply of platinum in 1991 is expected to surpass demand by 210,000 oz., writes metals dealer Johnson Matthey in an interim review.

Supplies may increase, because of increased Soviet sales, to 4.1 million oz., up by 360,000 oz. from 1990. Demand in the Western World could reach 3.88 million oz., up by 5% from last year.

South Africa and the Soviet Union account for most of the global supply of platinum group metals.

South African supply could rise to 2.9 million oz., Johnson Matthey says, which would be lower than anticipated. (Among other factors, producer Impala has reported problems this year.) Soviet sales are expected to reach 930,000 oz. this year.

“Autocatalyst demand will be sustained, at 1.54 million oz., despite the worst U.S. car sales since 1982,” says the review. Recovery of platinum from spent converters may increase by as little as 10,000 oz., to 225,000 oz., because of lower scrappage rates in North America.

Jewelry demand is expected to increase by 8% to 1.47 million oz., while industrial demand should ease slightly.

The price of platinum in New York was as high as US$420 per oz. in January of this year and as low as US$332 in August. The metal was recently trading in the US$360-370 range.

Johnson Matthey also forecasts a surplus of palladium of 230,000 oz. this year. Rhodium demand is also expected to be lower this year than in 1990.