Sibanye-Stillwater, the South African company that is the world's largest platinum producer, believes platinum prices could rise by more than 80 per cent in the next four to five years as the global economy recovers and supplies dwindle.
Chief Executive Neal Froneman said in an interview that the forecast comes as demand for platinum group metals has returned to pre-pandemic levels.
Platinum prices, which hit an 18-year low in March, have nearly doubled recently amid supply disruptions and a recovery in China's car industry.
China's auto industry uses platinum in pollution control devices.
Froneman said platinum's rating had just begun to change and would continue to do so.
Platinum could eventually reach $2,000 an ounce, and possibly more.
This is not Froneman's first bold prediction.
When the South African miner bought Stillwater four years ago, critics said he had overpaid for the US palladium producer.
Since then, palladium prices have nearly quadrupled, allowing Spanye to enjoy dividends and pay down debt.
Froneman said platinum's use would be supported by its growing use in hydrogen fuel cells, while carmakers in China and North America are starting to use platinum as an alternative to pricier palladium in automotive catalysts.
BASF SE, with support from Spanya and Impala Platinum Holdings, has developed a new technology for a partial replacement of palladium in autocatalysts, which will increase Platinum demand by at least 300,000 ounces a year, he said.
Froneman says alternatives are progressing well in China, where the regulatory environment is much more flexible.
Froneman is not alone in his optimism about platinum.
Platinum was trading just above $1,100 an ounce on Thursday, but Georgette Boele, senior precious metals strategist at ABN Amro, said gold could be around $1,500 an ounce in 2022.
"What is certain is that the precious metal will increasingly take center stage," Bohr said in a January 6 report.
As for rhodium, the world's most expensive precious metal, prices are likely to keep rising, according to Froneman.
Rhodium prices hit a record high on Thursday.
The chief executive of Spanye, the world's largest rhodium supplier, says there is still a big gap.
He said there was no reason for rhodium and palladium prices to fall back;
Platinum, however, has every reason to rise.
