PR95998

LONDON, May 16, 2022 /PRNewswire=KYODO JBN/--

The platinum market should move closer to balance in 2022, according to Johnson

Matthey's latest PGM Market Report. This provides an overview of demand for

platinum group metals in 2021 and an outlook for 2022, in advance of the annual

London Platinum & Palladium Market week.

Platinum demand growth will be driven by rising consumption in catalysts for

heavy duty trucks, and increased use of platinum (in place of palladium) in

gasoline autocatalysts. South African platinum supplies will contract by 9%,

with plant maintenance at the country's two largest PGM refiners, and mining

activity hit by operational challenges. Industrial demand will remain robust,

although it will retreat from the record levels seen in 2021 when Chinese glass

companies purchased unusually large quantities of platinum.

Johnson Matthey's report shows that the palladium and rhodium markets could

move back into deficit in 2022, with lower South African supplies and downside

risks to Russian shipments. Demand growth will be constrained by weak vehicle

output, and cost-saving programmes by auto and industrial consumers. High

prices have triggered significant thrifting by Chinese automakers, increased

substitution of palladium with platinum in gasoline autocatalysts, and

reductions in rhodium use by glass companies. Prices for both metals remained

strong during the first four months of 2022, with palladium climbing to an

all-time high of over $3,300 in March as supply concerns intensified.

Rupen Raithatha, Market Research Director at Johnson Matthey, commented: "We

expect weak car output to moderate PGM demand growth in 2022. In recent months

we've seen repeated cuts to vehicle production forecasts, due to semiconductor

shortages and supply chain disruption. There could be further downgrades to

come, especially in China, where Covid disruption led to stoppages at some car

plants during April. However, PGM supplies are also under pressure, with

Russian shipments facing logistical and commercial hurdles, and South African

mines losing production due to extreme weather, electricity shortages, safety

stoppages, and intermittent labour disruption."

Industrial demand for platinum is forecast to fall short of 2021's record

level, because some of the platinum required for this year's fibreglass

expansions was acquired in advance. However, platinum consumption by the glass

industry should remain robust by historical standards, reflecting the growing

role of glass fibre reinforced materials in carbon reduction applications such

as vehicle lightweighting and wind power. In contrast, glass sector demand for

rhodium will be weak, with glass companies further reducing the rhodium content

of alloys used in glassmaking equipment.

Stewart Brown, Research Manager at Johnson Matthey, said "Platinum alloys used

in fibreglass production have traditionally contained 10ｰ20% rhodium, to

help glassmaking apparatus withstand extremely high temperatures. Using more

rhodium allows for longer production campaigns, improves productivity, and

reduces the frequency of recycling and refabricating equipment. Until very

recently, 10% was widely regarded as the lower limit, but exceptionally high

rhodium prices have driven some fibreglass companies to reduce the rhodium

content of their alloys even further."

Demand for PGM in the chemical industry is forecast to enjoy double-digit

growth in 2022, reflecting continued investment in Chinese petrochemicals

capacity. Total PGM consumption in China's petroleum and chemical industries

will rise by 12% and is set to exceed one million ounces for a fifth

consecutive year. Johnson Matthey's May 2022 PGM Market Report includes a

special feature on the impact of Chinese industrial policy on PGM demand.

Jason Jiang, Johnson Matthey's Market Research Manager for China, said: "The

13th Five Year Plan, which ran from 2016 to 2020, saw extensive modernisation

of China's petroleum refining industry, and massive investment in 'building

block' chemicals used in many industrial products. This has generated

significant demand for all the PGM, especially platinum. Since 2016, we

estimate that over 7 million oz of PGM have been purchased by Chinese petroleum

refiners and chemicals producers. Going forward, there is potential for new PGM

use in energy transition applications such as lower-carbon fuels and chemicals.

Using PGM process catalysts often allows for more energy efficient reactions,

with fewer unwanted byproducts and reduced water consumption."

Note to editors:

Johnson Matthey Plc's PGM Market Report can be viewed and downloaded from the

website (https://platinum.matthey.com/market-research) and provides an overview

of demand for platinum group metals in 2021 and an outlook for 2022. You can

follow us on Twitter at @PMMJM.

Johnson Matthey's Market Research Department has undertaken fundamental

research into the Platinum Group Metals markets since the 1980s. Since 1985,

Johnson Matthey has published supply and demand data, in the Platinum and

Interim Platinum series of reviews (1985 - 2013) and in the PGM Market Report

(2014 - 2021). Previous reviews and reports can be downloaded from

http://www.platinum.matthey.com/en/report-archive

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Source: Johnson Matthey