Platinum production is concentrated in fewer places than almost any other traded metal. That concentration is geological in origin and it shapes the market's behaviour.
The geology occurs in very few places
Economic platinum group deposits form in layered igneous intrusions, formations created by particular conditions that arose rarely in the geological record.
A small number of such formations account for the overwhelming majority of known reserves, and no comparable body has been found in most of the world.
Exploration cannot solve this, because the metal is not distributed evenly enough for new districts to be discovered where the geology does not permit them.
The mines are deep and labour intensive
The main producing reefs are narrow and dip far underground, so extraction requires deep shafts and work in confined stopes rather than open pits.
Mechanisation is difficult in narrow reef mining, and the operations employ very large workforces by the standards of modern mining.
Costs are therefore driven by wages and by the expense of moving people, air and water over long underground distances.
Local disruptions become global events
Power interruptions, industrial disputes, shaft incidents and flooding affect an unusually large share of world supply when they occur in a concentrated district.
Because there is little production elsewhere to compensate, such events feed straight into global availability rather than being absorbed regionally.
This is a large part of why platinum prices can move sharply on news that would be a local story in a more distributed industry.
Recycling supplies a meaningful share
Spent autocatalysts contain recoverable platinum group metals, and collecting and processing them provides a substantial portion of annual supply.
That stream depends on how many vehicles are being scrapped and on collection economics, so it responds to prices and to vehicle turnover rather than to mining decisions.
It partially offsets the concentration of mine supply, though the recycling and refining capacity is itself concentrated in a limited number of facilities.
Long lead times prevent quick responses
Deepening a shaft or developing a new reef takes many years and heavy capital, so producers cannot expand quickly when prices rise.
Extended periods of weak prices lead to shafts being closed, and a closed deep mine is expensive and slow to reopen because it floods and deteriorates.
Supply therefore adjusts in large, delayed steps, which contributes to the long price cycles the metal has historically shown.