Introduction to Platinum

What is Platinum?

Platinum is a rare, silvery-white precious metal that is ductile, malleable, and highly unreactive. It is often used in jewelry, watches, and coins. It is also used in producing catalytic converters and laboratory equipment and for its electrical and thermal conductivity.

Platinum as an investment

Platinum is a precious metal that has been used for investment for centuries. Platinum is rarer than gold or silver, and its price is more volatile, making it a potentially good investment for higher returns. It can be used as a hedge against inflation and economic uncertainty and is a valuable alternative to traditional investments such as stocks, bonds, and even gold. Platinum is also used in the industry for various applications, including catalytic converters, medical equipment, and jewelry.

Platinum history

Platinum’s first documented use was in ancient Egypt, where it was used to make jewelry and decorative items. Spanish explorers in South America discovered large deposits of Platinum in the 1700s, which they dubbed “Platina” (meaning “little silver”). They quickly began exporting the metal to Europe, which was used to make coins and scientific instruments.

Platinum became popular as a precious metal in the nineteenth century when it was used to make jewelry and decorative items. It was also used to make surgical tools due to its high melting resistance and scientific equipment due to its high corrosion resistance.

Platinum was widely used in the automotive and aerospace industries for medical implants and electronics during the twentieth century. It is now primarily found in jewelry and catalytic converters.

Where is Platinum mined?

Platinum is found in various locations worldwide, including South Africa, Russia, Zimbabwe, Canada, and the United States. South Africa is the largest producer of Platinum, accounting for approximately 77% of the world’s total platinum production. In 2019, global platinum mine production was estimated to be 8,000 metric tons.

Where is Platinum used?

Platinum is used in a wide range of industrial and consumer products. It is used in jewelry and precious metal investments, as a catalyst in a variety of chemical reactions, in electrical contacts and electrodes, in dental alloys, as a pigment for glass and ceramics, as a coating for car catalytic converters, and as a cancer treatment. Platinum is also used in fuel cells and hydrogen fuel cell vehicles in the twenty-first century. In conclusion, Platinum is widely used in jewelry, industrial applications, medical uses, and investing.

What affects the Platinum price?

Various factors influence Platinum’s price, including supply and demand, geopolitical events, macroeconomic conditions, and other commodity markets. The automotive and jewelry industries use Platinum in production and manufacturing, significantly impacting platinum supply and demand. Furthermore, geopolitical events such as sanctions or trade disputes can affect platinum prices. The price of Platinum can be influenced by macroeconomic factors such as GDP growth, inflation, and currency exchange rates. Finally, the cost of Platinum can be affected by other commodity markets such as oil and gold.

Current market trends for Platinum

The current trends in the platinum market indicate that the demand for the metal is increasing. Platinum prices rose significantly in 2020 and the beginning of 2021, with some forecasting that prices could reach a historical all-time high of $2,300 per ounce by the end of 2023.

The main drivers of this rally are improved auto demand, a weaker US dollar, and increased investor interest in the metal. Platinum is widely used in the automotive industry, where it is used as a catalyst in the production of gasoline and diesel engines. Platinum is also commonly used in electric and hybrid cars. As the global economy begins to recover from the effects of the coronavirus pandemic, there has been an increase in demand for automobiles, increasing demand for Platinum.

The US dollar has also weakened recently, making gold more appealing to foreign investors. As the value of the US dollar falls, commodities such as Platinum also become more affordable and thus more attractive to investors. Finally, rising investor interest in the metal has aided the rally, with investors viewing it as a safe-haven asset and inflation hedge.

Gold or Silver or Platinum?

Because gold is a relatively rare metal with a high value and resistance to tarnishing and corrosion, it is a popular choice for jewelry, coins, and other investments. Silver is another popular metal for jewelry and coins, but it is less valuable than gold and tarnishes more easily. Platinum is the most scarce of the three metals. It is also expensive and lasts longer than gold and silver, making it a popular choice for high-end jewelry and investments.

Platinum as an investment

With such a diverse range of industrial applications, the price of Platinum is said to be primarily determined by industrial demand. However, over time, the price of Platinum follows a similar correlation to the price of gold (the most actively traded precious metal) and copper (the most actively traded industrial metal).

However, the price of Platinum can be volatile, especially when measured over a shorter time period, and many market commentators believe it is currently undervalued. Because of the impact of COVID-19 on financial markets, gold broke through the $2,000 per troy ounce barrier for the first time near the end of July 2020. This significant price increase was hailed as an all-time high for gold. Platinum, on the other hand, broke the $2,000 barrier in May 2008 and came very close again in 2011. However, platinum prices today are very different. While gold was trading at nearly USD 2,000 per ounce at the start of January 2021, Platinum was roughly half that price at just over USD 1,000.

Since then, the price of Platinum has steadily risen, reaching a six-year high in early February 2021. Although this appeared to be a significant increase, many pointed to the price disparity between Platinum and palladium, as both metals’ industrial uses are somewhat linked. Similarly, expectations for increased industrial demand and stricter emission regulations in the coming years have led some to speculate that the price of Platinum will continue to rise.

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