May 17, 2004
Platinum Demand Flat in 2003
Demand for platinum by jewelry manufacturers last year was flat in the U.S. and fell globally more than 13%, largely on the drop in demand in China.
According to "Platinum 2004," an industry status review by platinum metals fabricator Johnson Matthey, platinum demand in North America remained flat even as sales of platinum wedding bands increased and higher-end platinum jewelry reported strong sales. Demand was tempered by the use of lower-weight chains and necklaces by manufacturers to maintain price points as platinum prices increased in 2003. Also, U.S. manufacturers saw an increased presence of European and Asian platinum jewelry.
Globally, demand for platinum by jewelry makers fell as the Chinese and Japanese jewelry industries curtailed orders in favor of lower-priced gold. In China, demand by consumers didn't fall, but retailers and manufacturers bought less platinum in search of greater margins as platinum's price jumped during 2003.
In Japan, platinum demand dropped 15% to its lowest level since the1980s. Though platinum still holds its market share in Japan, overall jewelry sales there fell dramatically as consumers halted much nonessential spending. The number of weddings also fell. Demand also suffered somewhat as consumers of fashion-directed jewelry moved toward white gold's lower price points. This year, the researchers see a greater "balance" or consistency in platinum pricing. The highs of this spring ($920 per ounce) that quickly fell to about $780 per ounce should give way to a more even keel, the company predicts.
by Michael Thompson