Platinum: Repeated deficits tighten stocks – Commerzbank

Commerzbank's Commodity Analyst Barbara Lambrecht reports that focus in London is turning to Platinum group metals as the World Platinum Investment Council prepares updated forecasts. The bank expects WPIC to project a fourth consecutive annual deficit, further eroding above-ground stocks that already cover only four months of demand. Continued medium-term deficits and inventory drawdowns would likely underpin Platinum prices.

WPIC outlook and shrinking inventories

"At the start of the week, the World Platinum Investment Council (WPIC) will present its new forecasts for the platinum market. It is expected to forecast the fourth consecutive supply deficit for this year."

"Even though the supply deficit is likely to be smaller than in previous years due to weaker demand from the automotive industry and for platinum jewelry, above-ground inventories — which have already fallen significantly — are likely to shrink further."

"They now cover only four months of demand. By comparison, four years ago they still covered a year’s worth of consumption."

"Should the WPIC continue to assume that supply cannot keep pace with demand in the medium term and forecast a sustained drawdown of inventories, this is likely to support the price of platinum."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)