Platinum and palladium are, geologically, siblings — pulled from the same ore bodies in the same handful of mines across South Africa’s Bushveld Complex and Zimbabwe’s Great Dyke. Yet 2026 has pulled them in opposite directions. Platinum enters its fourth consecutive year of structural deficit, with above-ground stocks worn down to less than three months of global demand. Palladium’s deficit, by contrast, is shrinking fast — and several forecasters now see it tipping into outright surplus as battery electric vehicles erode the catalytic converter demand that has underpinned the metal for decades. For an East African trading house with no PGM mines of its own, the more interesting question isn’t which metal to bet on — it’s where the region already sits, quietly, inside this value chain.

01 — The Global SqueezePlatinum’s Deficit, Palladium’s Reprieve

Platinum’s 2025 rally was extraordinary even by precious-metals standards: the metal gained more than 90% over the year, breaking above $1,900/oz in December after a third consecutive annual deficit estimated at 692,000 ounces. It kept climbing into 2026, briefly touching a record near $2,924/oz on 26 January before retreating to the $2,000–2,300 range through the first quarter, and has since traded a wide band — dipping toward $1,600 in July before an 8% single-day jump to $1,756.70 on 4 August pulled the market’s attention straight back to fundamentals. The World Platinum Investment Council’s June 2026 outlook projects the deficit persisting through at least 2029, averaging 331,000–348,000 ounces a year even as it gradually narrows.

The spread of forecasts is itself informative: institutions agree platinum is undersupplied, and disagree sharply on how much that will move price. What’s driving the deficit is concentrated and structural — South African mine output, which accounts for roughly 80% of global platinum supply, fell approximately 5% year-on-year between January and October 2025 on flooding, plant maintenance and persistent power-sector disruption. Recycling supply is growing (roughly 10% expected in 2026) but not fast enough to close the gap. Meanwhile China’s decision to reclassify platinum as a strategic critical mineral has added a new, non-cyclical source of demand — the country imports more than 95% of the platinum it needs, and Beijing’s move creates what analysts describe as a structurally higher demand floor.

Platinum and palladium face quite a different set of challenges, though their outlook is tied more closely to industrial activity and automotive demand than the rest of the precious metals complex.Investing News Network, H1 2026 PGM Review

02 — The Producer MapSouth Africa’s Grip, Zimbabwe’s Ascent

South Africa remains the anchor of the global PGM complex, hosting the Bushveld Complex and producing roughly 70–80% of world platinum supply through four integrated majors — Anglo American Platinum (Valterra), Impala Platinum (Implats), Sibanye-Stillwater and Northam Platinum. But the anchor is fraying at the edges: African platinum output overall is forecast to decline in the mid-single digits amid operational constraints, illegal mining, crime, and thin new-project investment. The one major new South African development in the pipeline, the $1 billion Waterberg Project, isn’t expected to deliver its 222,000 ounces of annual production until 2029.

Zimbabwe’s Great Dyke — the world’s second-largest PGM-bearing ore body after the Bushveld — is where the growth story is actually happening. Zimbabwe’s platinum output is projected to grow at a 2.9% compound annual rate to 616,200 ounces by 2030, and the country is increasingly positioned, in the words of one recent industry analysis, to “take over any shortfalls from South African producers.”

03 — Why the Two Metals Are DivergingThe EV Substitution Trade

Roughly 75–85% of combined platinum and palladium demand still comes from a single source: catalytic converters on internal combustion engine vehicles. That shared dependency is exactly why the two metals are now moving apart. Automakers have spent the past several years substituting platinum for the more expensive palladium in gasoline autocatalysts wherever the chemistry allows — a trend that has structurally tightened the platinum market even as it eases pressure on palladium. Layer onto that a genuine geopolitical shock: in January 2026, the US International Trade Commission imposed a 132% tariff on unwrought Russian palladium imports, following a materially-injured finding on a petition filed by Sibanye-Stillwater. Russia, via Norilsk Nickel, supplies roughly 40% of global palladium, so any durable disruption to that flow is palladium-bullish even as the metal’s underlying demand story weakens on EV adoption.

The net effect: WPIC now projects palladium’s multi-year deficit shrinking to near-balance by 2027, with some forecasters explicitly modelling a shift into surplus as battery electric vehicle penetration climbs. Heraeus’s team frames it plainly — palladium may face a widening surplus as BEVs gain share, while platinum’s scarcity gives it room to substitute further into palladium’s traditional territory. It’s a rare case of two commodities sharing a mine, a smelter and a customer base, and still ending up on opposite sides of the supply-demand ledger.

04 — The East Africa AngleNo Mines, But Not No Exposure

Unlike gold, cobalt or lithium, platinum group metals have no meaningful production footprint in Kenya, Uganda, Rwanda, Ethiopia, Nigeria or South Sudan — this is, and will likely remain, a Southern Africa and Russia story on the supply side. But East Africa is not absent from the PGM value chain; it sits on it from an entirely different angle: as one of the world’s largest markets for imported used vehicles, and therefore as an underappreciated source of PGM-bearing scrap.

05 — OutlookWhat We Are Watching Into Year-End

• SA OutputWhether South African platinum production stabilises after 2025’s flooding- and power-related declines will materially affect how fast the deficit narrows.
• Karo Ramp-UpKaro Platinum’s progress toward first production is the clearest near-term signal of whether Zimbabwe can genuinely absorb South African shortfalls.
• Russia TariffsFurther US action on Russian palladium flows would be the single largest swing factor for palladium’s price in the second half of 2026.
• China PolicyPlatinum’s reclassification as a Chinese strategic mineral is a structural demand story worth tracking well beyond 2026.