In 2025, investors primarily focused on precious metals like silver and gold as geopolitical tensions intensified and inflationary pressures persisted. Analysts now argue that attention should also extend to platinum and palladium as supply constraints increasingly come into focus.
Last year saw strong gains across the precious metals complex, with silver prices rising by nearly 150%, palladium advancing by about 80%, and platinum climbing more than 126%. With demand expected to rise as supply conditions tighten, palladium and platinum prices are expected to remain supported through 2026.
About 80% of demand for platinum group metals comes from the automotive sector, where they’re used in catalytic converters in internal combustion engines. While the growing adoption of electric vehicles did slightly affect the demand for these devices, TD Securities analysts expect demand for catalytic converters to remain resilient in the United States.
Other sources of platinum demand, including the electronics and glass manufacturing industries, are also expected to support demand.
The key question is whether supply chains be able to keep up.
A recent report from the World Platinum Investment Council shows that platinum supply and demand are moving closer to balance after 3 years in which demand greatly exceeded supply. However, tight conditions continue to prevail in the physical market.
Figures show that existing global platinum stocks are sufficient to meet only around 5 months of demand, leaving limited stocks for meaningful inventory rebuild even as market fundamentals improve. Tight supply conditions are increasingly stoking fears of strategic rivalry over essential raw materials. These concerns deepened towards the end of last year after the U.S. Geological Survey added palladium and platinum to its list of critical metals.
TD Securities commodity analysts note that as the global economy shifts toward a more conflict-driven footing, incentives to accumulate strategic mineral reserves are likely to persist. They explain that the possibility of additional tariffs being introduced and the ongoing Section 232 investigation continues to reinforce stockpiling behavior.
Combined with a growing preference for “just-in-case” inventory strategies, this is expected to encourage unusually large inventory accumulation, preventing global stock levels from recovering and further intensifying supply constraints, particularly in the London market.
On pricing, TD Securities sees platinum prices averaging $1,800 an ounce in the 2nd half of 2026. MKS PAMP’s Nicky Shiels expects platinum prices to hit $2,000 an ounce this year.
Not all are optimistic though, with BMO Capital Markets forecasting average prices of $1,375 per ounce this year.
The price trends of this precious metal will be of great interest to enterprises like Platinum Group Metals Ltd. (NYSE American: PLG) (TSX: PTM) that produce most of the platinum that is sold around the world.
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