Platinum vs Palladium: 2026 Market Split Emerging

Two precious metals riding gold’s coattails in 2025, but their paths diverge sharply next year.

The 2025 Story So Far

Platinum has been the standout performer, hitting $1,725/oz in October—a 90% YTD surge—before pulling back to the $1,600 range. Still sitting at 12-year highs. Palladium followed with an 80% rally to $1,630/oz, now trading around $1,430.

Both metals caught the precious metals wave as gold went parabolic. But platinum had extra fuel: tight above-ground inventory, production disruptions in Southern Africa and North America, plus surging jewelry demand in China as gold premiums pushed buyers toward alternatives. Investment inflows into platinum ETPs also juiced demand.

Palladium? It rode the momentum but with weaker fundamentals underneath—analyst describe it as a “laggard” with lukewarm industrial outlook.

Here’s Where It Gets Interesting: 2026 Divergence

Metals Focus just dropped their annual outlook, and the two metals tell completely different stories.

Platinum: Bull Case Intact

• Physical deficit expanding: 415,000 oz in 2025, widening to 480,000 oz in 2026
• Mine supply collapsing to 12-year lows (excluding 2020), down 2% YoY with few new projects coming online
• Demand holding up better than expected: 1% rebound predicted from glass and chemical sectors in China
• Price target: $1,670/oz average in 2026 (up 34% from 2025)

The structural headwind for mining—years of underinvestment creating genuine supply scarcity—is platinum’s secret weapon.

Palladium: Bear Case Building

• Physical deficit actually shrinking: 566,000 oz in 2024 → 367,000 oz in 2025 → 178,000 oz in 2026
• Supply tightening reversed by 10% recovery in recycling activity
• Total supply up 1% despite 3% mine production drop
• Auto sector demand sliding further as EV adoption (though slowing) keeps eroding catalyst converter usage
• Price outlook: $1,350/oz Q4 2025, sliding to $1,150/oz Q4 2026

Why the Split?

Both metals face the same mining supply pressures, but palladium’s demand side is deteriorating. The auto sector—palladium’s bread and butter—is shifting back to cheaper alternatives as EV trends mature. Recycling is ramping up, killing scarcity. Result: deficit evaporates, prices compress.

Platinum dodges this bullet. Its demand is more diversified (jewelry, industrial glass, chemicals), and crucially, it’s gaining share in automotive applications away from palladium as catalytic converter makers optimize for cost.

The Takeaway

2026 shapes up as a tale of two metals: platinum gets the structural tailwind from supply scarcity + stable demand, palladium faces the headwind of shrinking deficits + sector rotation. For investors, it’s a rare case where the precious metals complex doesn’t move as one—platinum gets the precious metals rally, palladium gets left behind.