Precious Metals

Higher demand forces revision in platinum surplus forecast

“Coin purchases were not as high in the second quarter as in the first because the U.S. Mint sold most of its mintage of platinum American Eagle coins in the first quarter,” the WPIC notes.

Images courtesy of the U.S. Mint.

A strong increase in investment demand for platinum has resulted in the World Platinum Investment Council revising its 2019 forecast for surplus metal.

The WPIC’s projections now forecast a surplus of 345,000 ounces compared to the previous 375,000 ounces.

According to the WPIC’s Platinum Quarterly for the second quarter of 2019, “total demand in 2019 is forecast to rise 9 percent compared to 2018. Unprecedented investment demand in the first half of 2019 of 855,000 ounces — 720,000 ounces from increased exchanged-trade-funds holdings and 135,000 ounces from bar and coin purchases — supports a conservative investment demand forecast for 2019 of 905,000 ounces. This more than offsets expected demand increases in the automotive and jewelry segments of 4 percent and 5 percent, respectively.”

The demand for coins and bars reached 60,000 ounces during the second quarter of 2019. Japanese investors, who are responsible for a large chunk of bar demand, took advantage of the drop in the platinum price to add to their portfolios, according to the WPIC’s findings.

“Coin purchases were not as high in the second quarter as in the first because the U.S. Mint sold most of its mintage of platinum American Eagle coins in the first quarter,” the WPIC notes.

The full quarterly report on the platinum market from the WPIC can be found here.

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