Platinum market may see first surplus in six years in 2017: JM – by Jan Harvey (Reuters U.S. – November 14, 2016)

LONDON – The platinum market could return to surplus for the first time in six years in 2017 as lower autocatalyst loadings and weakness in Chinese jewelry buying pull demand lower, refiner Johnson Matthey said in a report on Monday.

Mine supply is expected to be flat next year, but supply of recycled metal from autocatalysts has the potential to rebound, it said.

“In most industrial sectors, the demand outlook remains firm, but purchases in the autocatalyst industry are likely to dip slightly as lower-platinum-loaded catalyst systems are introduced in increasing numbers in European vehicles,” it said.

“As demand in the Chinese jewelry sector seems set on a downward trend, market balance will likely depend on the extent of growth in autocatalyst recycling and the level of physical investment. Unless the latter remains at similar levels to those seen in 2016, we could see the platinum market return to a surplus for the first time since 2011.”

The platinum market likely recorded a shortfall of 422,000 ounces this year, JM said. Platinum supply is expected to have grown marginally as lower output in major producer South Africa was counterweighed by gains elsewhere and growth in recycling.

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