Platinum and palladium have their own unique drivers, but both are basking in gold’s glow in 2025.
Of the two, platinum has been the biggest winner in 2025. The price of the precious metal briefly hit a year-to-date high of US$1,725 per ounce on October 16, a 90 percent increase from the start of the year. Although it’s since experienced a pullback below the US$1,600 level, the platinum price remains at 12 year highs.
As for palladium, its price was up nearly 80 percent by October 16 to reach its 2025 peak of US$1,630 per ounce. It too has fallen back since then, currently sitting at the US$1,430 level.
What’s next for platinum and palladium after those price runs? In its annual Precious Metals Investment Focus report, published on October 25, Metals Focus outlines key supply and demand trends, as well as its outlook for prices.
Platinum market reflecting more than gold’s shine
Platinum is no doubt benefiting from strong investor demand for precious metals. But the metal’s robust supply and demand fundamentals are also at play, according to Metals Focus analysts.
Aboveground inventories of platinum remain tight, while future mine production is bogged down in operational challenges. “In Southern Africa, outages and heavy rainfall have disrupted production, while North America is undergoing restructuring,” notes the report.
On the demand side, platinum usage from the jewelry sector has posted significant gains this year, especially in China. As the price of gold skyrockets, platinum jewelry has become a much more attractive alternative. Investment flows into platinum exchange-trade products in China and the US are another key demand driver for the metal this year.
Platinum and palladium prices.
Chart via Metals Focus, Bloomberg.
While platinum prices are at levels not seen in 12 years, palladium prices are only experiencing a two year high.
“Palladium has also benefited at the margin, but remains a laggard, with a more lacklustre fundamental outlook limiting investor enthusiasm,” according to Metals Focus.
2026: Platinum bull, palladium bear
Platinum prices will continue to benefit from the overall upward trend in precious metals prices for the remainder of 2025 and well into 2026. The ongoing supply deficit in the platinum market is also highly price-supportive.
Metals Focus is forecasting a third consecutive physical platinum deficit for this year, totaling 415,000 ounces as platinum mine output is expected to decline by 6 percent year-on-year.
Demand is projected to fall by 4 percent largely due to lower output in the glass and automotive sectors.
Platinum’s supply deficit is expected to continue into 2026 and grow to an estimated 480,000 ounces as mine supply falls by 2 percent to a 12 year low (excluding 2020). “With few new projects coming online after years of underinvestment, mine supply is undergoing structural decline,” the report’s authors note.
This will be happening at the same time as an expected 1 percent rebound in demand, buoyed by renewed industrial usage, specifically out of the glass and chemical sector in China.
Even so, Metals Focus cautions that demand out the automotive and jewelry sectors is likely to contract.
The trend toward electrification is the auto industry may have slowed, but it’s still expected to erode platinum demand, especially as catalytic converter manufacturers shift back to more cost-effective palladium.
Metals Focus is forecasting a 2026 average platinum price of US$1,670 per ounce, up 34 percent over the previous year.
Platinum and palladium price outlook.
Chart via Metals Focus, Bloomberg.
Looking over to palladium, Metals Focus has a more bearish view.
The firm is projecting palladium prices to average US$1,350 in Q4 2025, falling to US$1,150 by Q4 2026. Although the palladium market has been in a physical deficit for the past few years, that deficit is expected to shrink from 566,000 ounces in 2024 to 367,000 ounces in 2025 before narrowing even further to 178,000 ounces in 2026.
The same structural issues plaguing platinum are also of course weighing on palladium mine supply, which is forecast to fall by 3 percent in 2026. However, secondary supply is projected to increase by 10 percent as recycling activity recovers.
Overall, total palladium supply is expected to grow by 1 percent for the year. At the same time, demand for palladium is set to decline by just over 1 percent in 2026 on a drop from the automotive sector.
Investor takeaway
Both platinum and palladium are considered precious metals based on their rarity and use in jewelry fabrication and physical bullion. As such, they both are known to benefit when investor sentiment for safe-haven gold is high.
However, not all precious metals are precious to investors at the same time — just ask silver. Industrial usage of these metals is a much bigger driver of demand compared to the investment space. For 2026, it’s platinum that will continue to ride gold’s rally and provide investors with plenty of upside based on its strong fundamentals.
Securities Disclosure: I, Melissa Pistilli, currently hold no direct investment interest in any company mentioned in this article.