Palladium Is the Only Precious Metal That Did Not Set a Record in January. That Is the Whole Story

Platinum's surplus contracted by around 57 per cent in 2025, to roughly 92,000 ounces, the smallest annual surplus in more than a decade. The World Platinum Investment Council expects a fourth consecutive deficit year in 2026.

Three things sit behind that.

1. South African supply is fragile. Power interruptions and maintenance bottlenecks at South African mines are a recurring constraint, and this is not a supply base that can be expanded on a two year view.
2. Hybrids turned out to be the winner nobody planned for. A hybrid has both a battery and a combustion engine, which means it still needs an autocatalyst. The market spent a decade arguing about petrol versus electric and the answer, commercially, has been both at once.
3. The data centre bid is real and very new. Platinum group metals go into the electronics and the hydrogen equipment that the AI build-out consumes, and some estimates have that demand growing fivefold by 2030. It is small today. It is growing from a base of almost nothing, which is the only place fivefold numbers come from.

What about rhodium?

Rhodium is the market almost nobody trades and everybody quotes, because the numbers are spectacular in both directions and the liquidity is close to nonexistent.

Its surplus is expected to widen modestly this year, which puts a ceiling on any real appreciation while offering some protection underneath. That is an unglamorous conclusion for the most glamorous price in metals, and it is the right one.

Are the 2026 forecasts worth anything?

Read them as arguments rather than predictions, because they contradict each other completely.

Metals Focus has argued platinum could rise 71 per cent and rhodium 62 per cent this year on persistent deficits, with palladium up 37 per cent. Heraeus, refining these metals rather than forecasting them for a living, took the opposite view: that the rally went too high too quickly and prices should reset lower.

Both houses are serious. They are looking at the same supply data and disagreeing about whether investors will keep paying for it, which is not a question the supply data can answer. Our piece on how much a precious metals price target is actually worth goes further into why the spread between forecasters is so wide this year.

What should you take from the platinum group metals in 2026?

That a supply deficit is not a reason to own something, and a surplus is not a reason to avoid it.

Palladium has spent four years in a market that was mostly balanced or short and its price has fallen by almost two thirds, because everyone can see the demand curve bending down. Platinum has a smaller deficit and a better price, because it has three demand stories rather than one dying one.

The metal that matters is not the scarce one. It is the one somebody will still need in 2035. On that test, and only on that test, platinum and palladium are not the same trade at all, and our account of what happened to silver this year shows the same principle at work in a market ten times the size.