Our latest long-term PGM market view to 2032
SFA (Oxford)’s Long-term PGM Market Outlook is an in-depth, forward-looking report on the current and long-term trends and influences acting on the global PGM markets. This report examines the changing nature of the PGM markets out to 2032 following the influences acting on their sources of supply and demand, and their investment vehicles. Released biannually, and tailored to individual client requirements, each report delivers a concise picture of the key metal markets and is vital in understanding the price risks and sustainability of the market for investment strategising in the PGM value chain.
Discover new long-term market trends
Our report is packed with an all-inclusive analysis of the platinum, palladium and rhodium markets out to 2032, and provides a long-term sensitivity analysis of demand with vital information needed to best gauge the impacts in the usage of palladium, platinum and rhodium as a result of tightening tailpipe emissions standards, intra-metal substitution trends, shifts in powertrains (advances in electriﬁcation of powertrains and pure battery-electric vehicles), and recycling. It provides an analysis of the changes in and economics of global supply, as well as long-term production profiles. Also included is a detailed forecast evaluation of the PGM markets (including metal prices and their inﬂuence on the jewellery, industrial, chemical, petroleum and investment sectors).
We are now closely following fuel cell demand in our supply-demand balances (covering autos, electrolysers and other industry uses). ESG analytics has also become a key feature comprising the entire PGM food chain from suppliers to users, at the start of a long journey and strategic imperative for the PGM sector. The report addresses the following key areas:
Demand and pricing
Robust, economically derived, PGM price forecasts for ten years based on fundamental global and regional supply-demand market developments and relevant macroeconomic factors. The Board note offers an explanation of the influence of both the project incentive price and mine closure inducement price on the long-term average price, along with assumptions and calculations used to derive such logic, including an associated incentive price by project. Similarly, SFA (Oxford)'s methodology for a long-term average price beyond a five-year forward curve and its use as a proxy for the average pricing beyond 2020 is articulated.
An analysis of global demand trends on a regional basis, covering the major PGM end-use sectors (autocatalysis, jewellery, glass, petroleum, electronics, chemical, nitric acid, and medical/dental) and including the investment sector (such as exchange-traded funds).
An analysis of global autocatalyst demand, with special attention, applied to environmental legislation affecting global emission standards, gasoline, diesel and hybrid trends, PGM loadings (thrifting) and the substitutability of platinum and palladium in this end-use sector. Future automotive developments and opportunities for PGM demand growth are also commented on, including fuel cell technology, hybrid vehicles and other alternative fuels. A breakdown of autocatalyst history/forecasts by region and associated assumptions (automobile volume and associated intensity of PGM loadings) is included.
Reports of historical, current and future producer mine supply trends for PGMs, referencing recent expansions and their deliverability, other new projects, including the junior sector coming online, and projects shelved or postponed. PGMs produced as by-products of base-metal mining are also considered.
A comprehensive explanation of the long-term cost of producing virgin metal, taking account of the cost and profit dynamics of production on a regional basis (South Africa − Western Bushveld, Eastern Bushveld, Northern Limb, Zimbabwe, USA, Canada and Russia). Forward extrapolations of production profiles, costs and margins have been conducted to provide short-, medium- and long-term pictures of producers’ profitability. Mines that do not have PGMs as their primary output but which are, nevertheless, substantial PGM producers (‘Nornickel’, a nickel producer, and ‘Canadian other’, which includes the operations of Vale and Falconbridge) are also included in our analysis.
Producer profiles, using a consistent framework for comparison based on cash costs and excluding capital, financing and depreciation/amortisation charges. The basic cost measurement reflects primarily physical production costs and includes other cash costs incurred, being mainly corporate overheads, marketing and royalties, etc. Costs are calculated net of the credits arising from the sale of by-products (Net TCC/4E oz). Rand currency sensitivity comments are included and key components/assumptions for the cash cost curve are defined.
An assessment of the future potential volumes of recycling, including autocatalyst, electronics and jewellery scrapping rates. The analysis covers collection rates, types and age of scrap supply, timing, contained metal and ratios, and the business case to recycle, as well as incentive prices and impacts from price volatility.
Our detailed analysis and valuable industry insight is backed up by eleven analysts working discreetly with the industry in all areas of the value chain, whether at South African mines, valuing projects and plants around the world, working with fabricators to assess the impact of new end-uses, visiting China and Japan to investigate their jewellery markets or with corporate Boards conducting price risk analysis for multi-million dollar business decisions.
Who should read this report?
Commodity risk managers from fabricators, car companies, petroleum companies and other end-users, for help with assessing price volatility, price direction, or the economics and security of supply.
Financiers, pension funds, investors and other financial institutions needing to understand the long-term risks and opportunities in the industry, future costs of production and long-term prices for project and business valuation.
Miners, refiners and juniors that require long-term prices and market justification for project appraisal, investment timing, business strategy, and an independent view on the markets.
New business entrants.
Live Q&A with the analysts
Each biannual report is supported by a video call, most often hosted through MS Teams, which is led by Beresford Clarke, along with our team of expert PGM analysts to highlight the key market aspects and address any further questions you may have.
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