Platinum

Platinum is a silvery white color metal and is more rare in nature than gold. Platinum is used in jewelry and in many industrial applications alike. Due to high demand and limited supply, the platinum market tends to trade at a higher price than gold. Let us take a look at the biggest players in the platinum market.

Who accepts platinum trading?

The Platinum Market is packed with a large number of interested participants. A large part of them buy platinum as a commodity, and the rest enter the market to profit from the price fluctuations of this precious metal.

  1. Jewelry manufacturers

    The jewelry market forms a large part of the global consumption of platinum. The high demand for white jewelry coupled with the scarcity of supply is one of the main reasons why platinum is more expensive than gold.

  2. Automotive Industry

    The automotive industry has a large share of demand for platinum and is used in the automotive industry, which reduces the damage of its emissions. Other industrial applications include hard disks, fertilizers and anti-cancer drugs.

  3. Investors

    Investors who accept platinum buy platinum in the form of coins and bullion. Since 1997, the US Platinum Eagle has been the only official Platinum currency approved for investment by the US government.

  4. Traders

    A growing number of traders view platinum trading as an opportunity to diversify their positions in alternative markets and to benefit from the price fluctuations of this precious metal.

What factors affect platinum prices?

Traders often ignore platinum for gold and silver. Once traders understand the unique characteristics of this market, however, they often have the opportunity to expand their trading to platinum as an interesting commodity.

  1. Platinum supplies limited geographies

    Platinum scarcity is estimated at about 15 to 20 times the scarcity of gold. About 90% of platinum ore globally comes from Russia and South Africa with high degrees of uncertainty about the future of this supply. In addition, extracting a pure ounce of platinum requires a lot of energy and capital and it is not strange that these supply conditions are one of the main determinants of its price.

    There are only two countries engaged in platinum mining and mining activities, and there are more opportunities to monopolize them, and these behaviors have a very strong impact on platinum production levels and therefore on its prices.

  2. Demand levels vary

    Because of its dual role as a commodity widely used in the automotive industry and as a precious metal, the demand for platinum is closely linked to legislation. In the summer of 2017, for example, demand for platinum fell as sales of diesel vehicles fell in some European countries on the back of some speculation that governments would raise costs for owners of diesel cars.

    There are more factors affecting the price of platinum than the demand for catalysts in the automotive industry, but it is useful for traders who want to participate in this market to be aware of the main events that can cause negative attitudes towards this precious metal.