HOW U.S. TARIFFS IMPACT THE PGM MARKET, RECYCLING, AND GLOBAL DEMAND FOR PLATINUM, PALLADIUM, AND RHODIUM
POSTED BY PATY MAK
The recent wave of tariffs imposed by the United States under the Trump administration is reshaping global trade flows, and the Platinum Group Metals (PGM) market is feeling the effects. Although platinum, palladium, and rhodium are not directly tariffed, the tariffs on imported vehicles and parts, including a 25% tariff on car imports, are expected to create significant disruptions in global PGM supply chains and demand.
Impact of U.S. Tariffs on Global PGM Demand
The automotive industry is the largest consumer of PGMs, with palladium and rhodium heavily used in gasoline engine catalytic converters, while platinum plays a major role in diesel systems and emerging fuel cell technologies. As the U.S. becomes a less attractive market for global automakers due to these tariffs, production forecasts are being revised downward.
Analysts predict that global platinum demand may drop by 1%, while palladium demand could decline by as much as 4%. Rhodium, with its niche role and volatility, may also experience similar disruptions. These demand reductions are not just a U.S. problem—they affect automakers, parts suppliers, and refiners across Europe, Asia, Latin America, and beyond.
How Tariffs Are Affecting the PGM Recycling Industry
The PGM recycling industry, particularly in catalytic converter recovery, is also facing challenges. Lower vehicle production means fewer end-of-life vehicles to supply scrap converters, which could reduce the volume of recyclables available for processing.
The ongoing volatility in PGM prices and uncertainty about future demand make it harder for recyclers to hedge risks and forecast returns. However, recycling PGMs may gain more strategic value as primary supply chains face disruptions or import-related cost increases. Countries with mature recycling infrastructure, such as Germany, Japan, South Korea, and South Africa, are likely to see increased demand for recycled PGMs as manufacturers seek alternative, tariff-free sources.
PGM Recycling and Its Growing Importance
As tariffs disrupt traditional supply channels, catalytic converter recycling could become even more vital. Recyclers in non-U.S. regions may become critical players in supplying secondary PGMs, helping to stabilize global supply and pricing. Recyclers in Europe and Asia may find themselves in a better position to secure supply agreements and process higher volumes of recycled metals.
Global Supply Chains Adjusting: How the U.S. Tariffs Affect PGM Producers and Refiners
Though PGMs themselves are not directly tariffed, the U.S. baseline tariff of 10% on most imports could increase costs for refining equipment, components, and packaging. This creates indirect challenges across the PGM value chain.
For export-heavy countries like South Africa and Russia, the real concern lies in decreased U.S. demand for their PGMs. These nations may need to adjust their production strategies or focus on diversifying their export markets. Meanwhile, manufacturers in regions unaffected by the U.S. tariffs are likely to localize sourcing and reduce dependency on U.S.-linked trade flows.
The demand for PGMs will likely evolve as green technologies like hydrogen fuel cells gain traction, potentially altering the balance of platinum, palladium, and rhodium use.
Final Thought: Global Adjustments to U.S. Tariffs and the PGM Market
In a globally integrated market like PGMs, shifts in U.S. trade policy don’t stay confined to one nation. These changes will ripple through supply chains, affecting recyclers, manufacturers, and consumers worldwide—from scrapyards in Europe to smelters in Africa. To navigate these disruptions, stakeholders in the PGM industry must stay agile, rethink supply strategies, and prepare for an evolving global demand landscape.