By Will Horner
The global platinum market moved to a surplus in the second quarter of the year, as a backlog of the precious metal, which had built up due to stoppages at South African plants, began to be processed and to enter supply, the World Platinum Investment Council said Thursday.
Supply outstripped demand by 161,000 troy ounces, the WPIC said in its quarterly report. That compares with a 93,000-ounce deficit in the first quarter and a 221,000-ounce deficit in the second quarter of 2020.
Mined supply rose to 1.591 million ounces in the second quarter. That was 10% higher than in the previous quarter and 65% higher than the second quarter of 2020. Total supply rose to 2.068 million ounces, a 55% increase year on year.
A stoppage at Anglo American Platinum Ltd.'s converter plant in South Africa in 2020 had weighed on output from the major producing nation. Large quantities of semi-finished platinum had built up as the miner worked to bring the plant back online. With the affected plant now working, the backlog was processed at a faster-than-expected speed, in part helping to push the market into surplus, the WPIC said.
The WPIC expects that around 300,000 ounces of the stockpiled platinum will be released by the end of the year, while the remaining 200,000 ounces are expected to all be released by the end of 2022.
Demand also rebounded as appetite for the metal from car makers and factories increased, though at a slower rate than the rebounding supply.
Total demand rose to 1.907 million ounces in the second quarter, just under a 23% increase from the same period last year. Quarter-on-quarter demand edged down just under 6%.
For the year, the WPIC is forecasting a surplus of 190,000 ounces, compared with an 883,000-ounce deficit in 2020.
Total 2021 platinum supply is forecast at 7.943 million ounces while demand is expected to stand at 7.753 million ounces.
Write to Will Horner at firstname.lastname@example.org
(END) Dow Jones Newswires