In its long-term outlook for platinum group metals, CPM said investment demand for PGMs, which has had an effect on recent prices, has been motivated by expectations of future price rises as global economic activity emerges from recession. It is worth bearing in mind that, unlike gold, PGMs are largely industrial metals - in round figures, three-quarters of the world's annual platinum demand is for industrial uses, particularly for vehicle exhaust catalysts.
So, sticking with platinum alone, CPM reckons that supplies of newly mined metal will remain insufficient to satisfy demand and that, through to 2013-14, the balance between supplies of new and recycled metal could be particularly tight.
By 2014, however, production mothballed at the start of the recession in 2008 will be back on stream, expansion projects put on ice by the major mining companies will have been ramped up and the many newcomers will have brought new mines on stream.
The growth will be largely from South Africa, though CPM is cautious about the effects of safety stoppages, power interruptions and so on. Supplies of by-product PGMs from base-metal mines in Russia and Canada should be rising in parallel with nickel production.
All this is at a time when industrial demand is recovering and secondary supplies are increasing, leading to a period of rising real (inflation-adjusted) prices until 2014. This is projected to be followed by a decline through to 2016, with well-balanced supply and demand, to be followed by further advances to 2019 as the market again tightens.
Moving away from real prices to those in nominal terms, CPM forecasts a steady rise for platinum from last year's $1212/ounce to average $1573 this year. It is expected to rise to $2035 in 2014.
Then, there is a fall to below $2000 predicted last until 2017 when the $2000 mark is expected to be breached again. By 2019, CPM reckons, platinum's average price will be just shy of $2190/oz in nominal terms.
As might be expected, much will depend on speculative trading. While investment demand continues to be driven by expectations of the effects of rising industrial demand on prices, CPM warns that selling in anticipation of eventual price declines could well exacerbate falling prices. On the other hand, if or when prices do start to slip, investors might well decide to buy at the then lower price.
The advent of investment demand, particularly by US and European exchange-traded funds, has added a significant imponderable in the market for what was once almost entirely an industrial metal. It could only take a few more currency scares for platinum to move way beyond even CPM's predictions.