Oversupply in platinum market on recycling
By Hu Xiaocen |
May 16, 2012, Wednesday
|
Print Edition
Print Edition
THE global platinum market suffered an oversupply of 430,000 ounces last year as more than 2 million ounces were recycled, according to a recent report.
British chemicals and precious metals company Johnson Matthey Plc said in a report that primary supplies of the metal grew 7 percent last year to 6.48 million ounces, a four-year high, mainly due to inventory releases from South Africa and higher output in North America.
Gross demand gained 2 percent to 8.1 million ounces in 2011 amid heavy purchasing by the glass and petrochemical industries, while physical investment sank 30 percent from the previous year.
But recycling increased by 12 percent to 2.05 million ounces, giving a net demand of 6.05 million ounces. But this resulted in the global market's oversupply of 430,000 ounces.
In China, platinum jewelry grew robustly last year despite the price movements of the metal, the report said.
The metal price fell to a two-year low of US$1,364 per ounce by the end of 2011, reflecting the supply surplus and a wider asset sale by investors in the fourth quarter. But the average trading price of US$1,721 per ounce for the whole year was up 7 percent from the previous year.
The London-based precious metal specialist expects supply and demand for the metal to drop this year.
"We foresee that supply and demand fundamentals will have a greater influence on the platinum market in 2012," the report said.
"There will be constraints on sales from South Africa leading to a reduction in global supplies."
British chemicals and precious metals company Johnson Matthey Plc said in a report that primary supplies of the metal grew 7 percent last year to 6.48 million ounces, a four-year high, mainly due to inventory releases from South Africa and higher output in North America.
Gross demand gained 2 percent to 8.1 million ounces in 2011 amid heavy purchasing by the glass and petrochemical industries, while physical investment sank 30 percent from the previous year.
But recycling increased by 12 percent to 2.05 million ounces, giving a net demand of 6.05 million ounces. But this resulted in the global market's oversupply of 430,000 ounces.
In China, platinum jewelry grew robustly last year despite the price movements of the metal, the report said.
The metal price fell to a two-year low of US$1,364 per ounce by the end of 2011, reflecting the supply surplus and a wider asset sale by investors in the fourth quarter. But the average trading price of US$1,721 per ounce for the whole year was up 7 percent from the previous year.
The London-based precious metal specialist expects supply and demand for the metal to drop this year.
"We foresee that supply and demand fundamentals will have a greater influence on the platinum market in 2012," the report said.
"There will be constraints on sales from South Africa leading to a reduction in global supplies."
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