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Platinum ETFs Outshining Gold & Silver in 1H2025: Here's Why
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After being in the doldrums for a long time, platinum has made a solid comeback in recent months, driven by strong industrial demand, supply constraints and clean energy adoption. In fact, platinum is the standout performer among precious metals, outpacing gold and silver.
This is especially true as abrdn Physical Platinum Shares ETF (PPLT - Free Report) has risen 40% so far this year, while its popular peers — SPDR Gold Shares (GLD - Free Report) and iShares Silver Trust (SLV - Free Report) — returned less than 30% each. Notably, most of the rise has occurred recently. Over the past month alone, gold rose 7% and silver climbed 13% but platinum skyrocketed 30% (see: all the Precious Metal ETFs here).
What’s Fueling the Rally?
Platinum is one of the rarest precious metals, primarily used in automotive catalytic converters, chemical processing, electrical components and petroleum refining. About 80% of global production comes from South Africa, followed by Russia and North America. South Africa faces challenges such as aging infrastructure and operational disruptions, leading to reduced output.
The platinum market is grappling with a pronounced supply deficit. The World Platinum Investment Council (WPIC) projects a shortfall of 966 koz, marking the third consecutive annual deficit and reinforcing concerns over tightening market fundamentals. Total platinum supply for 2025 is forecast to decline 4% year over year to 6,999 koz, the lowest level in five years, while demand is expected to decline 4% to 7,965 koz in 2025.
A resurgence in platinum jewellery demand in China is expected to drive a 5% increase in global jewellery demand in 2025. High gold prices have prompted consumers and jewelers to turn to platinum as a cost-effective alternative (read: Gold Up 27% YTD: How Long Will the Rally Last?).
Automotive demand remains resilient despite market uncertainty, with a modest 2% decline forecast to 3,052 koz for the full year. The slowdown in EV adoption has led to sustained demand for internal combustion engine (ICE) and hybrid vehicles, both of which utilize platinum in catalytic converters. Additionally, stricter emissions regulations, such as Europe's upcoming Euro 7 standards, are expected to increase platinum loadings in vehicles.
Investment demand remains robust, projected at 688 koz, supported by strong bar and coin purchases in China. Above-ground stocks are forecast to decline 31% to 2,160 koz by year-end, providing just three months of demand coverage, a significant signal of tightening availability.
Platinum also plays a pivotal role in the burgeoning hydrogen economy. It is used in fuel cells and hydrogen electrolyzers—core technologies in the clean energy transition. With governments and corporations ramping up investments in hydrogen infrastructure, demand for platinum in non-automotive industrial applications is soaring.
Relative Undervaluation
From a valuation perspective, platinum has been historically cheap relative to gold. For much of the past decade, platinum traded at a steep discount to gold, with the gold-to-platinum ratio climbing to 3.5 in May 2025 from the historic range of 1-2. This signals that platinum was significantly undervalued. Since platinum’s surge in recent weeks, the ratio has come to 2.7.
Platinum vs. Gold vs. Silver
All three precious metals have been on a surge this year. Gold is trading at record highs, driven by inflation concerns, central bank accumulation and geopolitical stress. The yellow metal continues to enjoy its status as the ultimate safe haven, particularly during periods of geopolitical turmoil and inflation. Silver has climbed to 13-year highs, benefiting from its dual role as both an investment asset and an industrial metal. The rally is supported by booming demand from clean tech and electronics (read: ETFs Riding High on Multi-Year Record Silver Prices).
Meanwhile, platinum occupies a unique middle ground — it’s a precious metal with powerful industrial utility. The metal is at a four-year high but still well below its all-time high set in 2008, making it appear undervalued in comparison.
With gold and silver appearing “overbought” to some, platinum is increasingly being viewed as the more attractive entry point.
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Platinum ETFs Outshining Gold & Silver in 1H2025: Here's Why
After being in the doldrums for a long time, platinum has made a solid comeback in recent months, driven by strong industrial demand, supply constraints and clean energy adoption. In fact, platinum is the standout performer among precious metals, outpacing gold and silver.
This is especially true as abrdn Physical Platinum Shares ETF (PPLT - Free Report) has risen 40% so far this year, while its popular peers — SPDR Gold Shares (GLD - Free Report) and iShares Silver Trust (SLV - Free Report) — returned less than 30% each. Notably, most of the rise has occurred recently. Over the past month alone, gold rose 7% and silver climbed 13% but platinum skyrocketed 30% (see: all the Precious Metal ETFs here).
What’s Fueling the Rally?
Platinum is one of the rarest precious metals, primarily used in automotive catalytic converters, chemical processing, electrical components and petroleum refining. About 80% of global production comes from South Africa, followed by Russia and North America. South Africa faces challenges such as aging infrastructure and operational disruptions, leading to reduced output.
The platinum market is grappling with a pronounced supply deficit. The World Platinum Investment Council (WPIC) projects a shortfall of 966 koz, marking the third consecutive annual deficit and reinforcing concerns over tightening market fundamentals. Total platinum supply for 2025 is forecast to decline 4% year over year to 6,999 koz, the lowest level in five years, while demand is expected to decline 4% to 7,965 koz in 2025.
A resurgence in platinum jewellery demand in China is expected to drive a 5% increase in global jewellery demand in 2025. High gold prices have prompted consumers and jewelers to turn to platinum as a cost-effective alternative (read: Gold Up 27% YTD: How Long Will the Rally Last?).
Automotive demand remains resilient despite market uncertainty, with a modest 2% decline forecast to 3,052 koz for the full year. The slowdown in EV adoption has led to sustained demand for internal combustion engine (ICE) and hybrid vehicles, both of which utilize platinum in catalytic converters. Additionally, stricter emissions regulations, such as Europe's upcoming Euro 7 standards, are expected to increase platinum loadings in vehicles.
Investment demand remains robust, projected at 688 koz, supported by strong bar and coin purchases in China. Above-ground stocks are forecast to decline 31% to 2,160 koz by year-end, providing just three months of demand coverage, a significant signal of tightening availability.
Platinum also plays a pivotal role in the burgeoning hydrogen economy. It is used in fuel cells and hydrogen electrolyzers—core technologies in the clean energy transition. With governments and corporations ramping up investments in hydrogen infrastructure, demand for platinum in non-automotive industrial applications is soaring.
Relative Undervaluation
From a valuation perspective, platinum has been historically cheap relative to gold. For much of the past decade, platinum traded at a steep discount to gold, with the gold-to-platinum ratio climbing to 3.5 in May 2025 from the historic range of 1-2. This signals that platinum was significantly undervalued. Since platinum’s surge in recent weeks, the ratio has come to 2.7.
Platinum vs. Gold vs. Silver
All three precious metals have been on a surge this year. Gold is trading at record highs, driven by inflation concerns, central bank accumulation and geopolitical stress. The yellow metal continues to enjoy its status as the ultimate safe haven, particularly during periods of geopolitical turmoil and inflation. Silver has climbed to 13-year highs, benefiting from its dual role as both an investment asset and an industrial metal. The rally is supported by booming demand from clean tech and electronics (read: ETFs Riding High on Multi-Year Record Silver Prices).
Meanwhile, platinum occupies a unique middle ground — it’s a precious metal with powerful industrial utility. The metal is at a four-year high but still well below its all-time high set in 2008, making it appear undervalued in comparison.
With gold and silver appearing “overbought” to some, platinum is increasingly being viewed as the more attractive entry point.