Platinum is becoming harder to find, and its value is rising. Normally, when something is scarce, the price goes up, and producers respond by making more.
A research note issued by World Platinum Investment Council (WPIC) says platinum doesn’t work that way, even as investors on the Botswana Stock Exchange (BSE) have been quietly getting in on the action. This is because its production and use don’t quickly change with price, and so even if demand stays high and supply remains tight, investors are warned that the imbalance can last a while.
NewPlat ETF, an investment instrument that tracks the real price of real platinum, is climbing.
Since the beginning of the year, its price has jumped nearly 27%, from P125.75 in January to P162.00 by close of business on Wednesday, according to the Botswana Stock Exchange (BSE).
This week alone:
On Tuesday, the price rose by P18.45
On Wednesday, it added another P2.55
That is not just a number going up on a screen, signaling that something big may be happening in the platinum market. Because behind every NewPlat ETF unit on the BSE is real platinum, stored safely in a vault. If you buy 100 units of NewPlat on the BSE (like you do with shares), you are holding some piece of platinum.
This is the same platinum used in car parts, jewellery, and even glassmaking.
If you had invested P100 in January, it would now be worth about P127. But the real story is not the profit, it’s the why. Because lately, the world can’t get enough of it. And this could help you with an investment case for the metal.
Platinum Is in Short Supply
According to a research note by Edward Sterck, the Director of Research at the World Platinum Investment Council (WPIC), less platinum is being produced than what is needed by end-markets for platinum (the four main demand drivers for platinum are automotive, jewellery, industrial and investment).
This shortage is called a deficit, and WPIC expects it will continue for years, at least until 2029.
This year alone, WPIC expects the deficit to be around 966,000 ounces. To imagine that, picture 27 big one-tonne trucks, each full of platinum, and it still wouldn’t be enough.
For reference, platinum is so dense that each of those trucks would be carrying a one-tonne cube of platinum only 36cm to a side.
Why Is There Less Platinum?
Miners are producing less platinum.
Platinum comes mostly from mines in South Africa. But mining companies have been cutting costs after prices dropped in recent years. That means they are mining less.
Recycling is down.
Platinum from the autocatalysts (catalytic converters) in cars that are being scrapped, jewellery, and industrial applications can be recycled. But recycling levels are still lower than normal, according to WPIC.
In fact, WPIC said 2025 could see the lowest total platinum supply since 2013, except during COVID.
So, if miners are not mining enough, and recycling is lower than normal, where is the platinum coming from to make up the difference between demand and supply?
Vaults Are Running Empty
To fill the gap, the platinum market is using up platinum that was mined previously and is currently held in vaults, called above-ground stocks. Think of it like using grain stored in silos to use, should the harvest fail.
But even above-ground stocks are beginning to get very low levels, according to WPIC. By the end of the year, there may only be three months’ worth of platinum left in these reserves, a dangerously low level, WPIC warns.
Borrowing Platinum Is Getting Expensive
Because platinum is a metal that is essential to many products, companies that need it are starting to borrow it, and the cost of borrowing platinum is currently high, especially compared to normal levels.
For context, it works like this:
Take, for instance, what is happening in Botswana. There is less cash available in the country, and, by extension, banks whose role is to lend out money to you (this is why lending rates have been going up). Banks need money to borrow you money. So banks have to attract money from pension funds. But money is in short supply, like with platinum. So banks have to pay pension funds more (interest) for them to give them this money. This is called the cost of borrowing (interest).
That’s what’s happening with platinum. For platinum, WPIC calls this the lease rate.
Lease rates are up. People who hold platinum are lending it out, but only for a specific period of time, and at a cost. Eventually, that platinum still needs to be returned.
“It remains to be seen whether sufficient platinum will be available at that time at current prices,”
Sterck said.
Why The Market Can’t Fix The Shortage Quickly
Usually, when something becomes scarce, its price goes up, just like the cash example in Botswana. The price rise then encourages producers to make more, and some buyers to back off, and eventually, things balance out.
But with platinum, it’s not that easy, Sterck said in a note published by WPIC.
Even if prices rise, he believesmines cannot quickly increase production. It takes time, money, and planning. And on the other side, Sterck believes some userswon’t just stop buying platinum, even if it’s expensive, because they need it and there is no ready alternative.
He said platinum is “price inelastic”, a fancy way of saying that price changes don’t easily change how much is produced or used. So even if demand stays strong and supply stays low, the market can stay out of balance for a long time.
What is happening to Demand?
In fact, WPIC expects a small drop in platinum demand in 2025, about 4% lower than the year before. But it said this fall is mostly because fewer new glass factories are being built.
Why Does Glass Need Platinum?
Having a high melting point and being extremely unreactive, platinum is used in the linings and in other equipment used to make strong glass for consumer electronics or high-quality fibreglass.
But since WPIC observed that fewer glass plants are planned right now, less platinum will be used this year in that industry, down from 690,000 ounces to 289,000 ounces, according to its estimates.
That’s like going from 20 truckloads to just 8.
But Sterck highlighted that other areasof demand are rising fast.
Jewellery and Investment Are Picking Up the Slack
The big surprise has been jewellery and investment. In the last few months, Sterck wrote that demand for platinum bars, coins, and jewellery has gone up, especially in China.
Here’s what WPIC is seeing:
More Chinese buyers are purchasing platinum bars than expected.
In China, jewellery fabrication in the first three months of this year was up 26% compared to the same time last year.
In Europe and North America, platinum jewellery is now cheaper than white gold, making it more attractive.
Why the shift from gold to platinum?
Gold prices are high, and in China, sales of gold jewellery fell by 32% in the first three months of 2025, according to WPIC. Some jewellery stores, especially smaller ones, are now selling off their gold stock to take profit and are restocking with platinum.
What Does This Mean for NewPlat?
NewPlat is backed by real platinum. So when platinum becomes more valuable, the value of NewPlat usually follows.
NewPlat tells a global story, one that’s being shaped by mines in South Africa, jewellers in China, and vaults around the world.
But it’s important to remember what Sterck said in the WPIC note: price changes don’t quickly reflect how much is made or used. So, even if there’s strong demand and not enough supply, the market can remain in a shortage for quite a while.
