Silver and platinum rallies could falter in Q3, gold loses ground on renewed risk appetite – Heraeus

(Kitco News) – While gold has pulled back from its April highs, prices are still high enough that they may further depress Indian demand, while the recent outperformance of silver and platinum may soon be coming to an end, according to precious metals analysts at Heraeus.

In their latest precious metals update, the analysts noted that Indian gold demand continued to wilt in the face of high prices.

“In 2024, India consumed 803 tons of gold – 70% of which was for jewelry,” they wrote. “This was a 5% increase year-on-year, despite the gold price rallying by more than 26% last year. The gold price has risen by another 27% so far this year, and demand has begun to respond in India. Demand in Q1’25 declined by 15% to 118 tons, and preliminary gold import data for April and May has continued to look weak, falling by 27% and 38% year-on-year, respectively.”

“June and July tend to be slow months for gold demand in India, before picking up again towards the end of summer in anticipation of Dhanteras and Diwali in Q3 and Q4,” they said. “August is usually the month in which imports peak. Should the gold price rise further over the next month, August imports and demand may underwhelm, which would point towards a decline in annual Indian gold demand this year.”

The analysts noted that gold prices declined for the second straight week last week. “Military activity in the Middle East was not shifting global commodity markets, as the oil price also returned to its previous price level,” they said. “By Friday’s close, gold was down 2.83% week-on-week at $3,275/oz.”

Spot gold is climbing back toward its earlier session highs on Monday, last trading at $3,284.80 per ounce for a gain of 0.32% on the session.

Turning to silver, Heraeus analysts noted that even as Chinese solar installations continue to break records, there’s trouble on the horizon.

“New installations of solar panels in China reached 93 GW in May, the highest ever monthly total, and more than double the installation rate in April,” they wrote. “The majority of the new installations were large industrial projects as companies rushed to complete construction before regulatory changes take place that limit the ability of new commercial and industrial installations to sell power to the grid, rather encouraging self-consumption. This, and the halt to guaranteed grid pricing from 1 June is expected to reduce incentives for new large utility solar PV projects in the second half of the year, and so the momentum of the last couple of months is forecast to slow.”

 Year-to-date, China has already installed 71% of last year’s total new solar capacity in 2025, the analysts said. “Assuming that the second half of the year sees a lower rate of installations, this year’s total may be in line with 2024. For silver demand, this would likely result in a contraction in solar PV demand from China year-on-year. In 2024, global solar demand reached 198 moz – most of which was consumed in China (source: The Silver Institute). However, the rate of thrifting in solar applications is expected to outpace usage in new installations, meaning demand could fall.”

“Since early June, the silver price has managed to hold its ground above $35/oz, and last week managed to rise 0.43% week-on-week,” they added. “By Friday’s close, the silver price stood at $36.13/oz.”

Spot silver fell as low as $35.461 half an hour after the open on Sunday evening, but the gray metal recovered almost as quickly and is once again challenging the $36 per ounce resistance level.

At the time of writing, spot silver last traded at $35.941 per ounce and is down 0.13% on the daily chart.

And platinum‘s recent rise to a decade-plus high may be short-lived, as the rally is looking stretched.

“The market may be tight in the short term, but with normalizing supply from South Africa, liquidity should improve,” the analysts wrote. “Further evidence is needed to show how demand in China responds to the price hike, and whether jewelry sales are growing faster than anticipated. Therefore, it is likely that the platinum price will correct over the second half of the year.”

But for now, the platinum rally is helping to ease South African miners’ price pressures.

“The South African PGM basket price is currently more than 30% higher than at the beginning of the year in US dollar terms,” Heraeus said. “For high-cost producers in South Africa, this will ease pressure on profit margins which have been eroded over the last 18 months as PGM prices have fallen and production costs have risen.”

They added that while platinum is a major revenue component, the basket includes palladium and chrome, which have also rallied. “Chrome prices have risen materially this year, which will help UG2 producers in particular,” the analysts said. “This has lifted the basket price just above the cost curve. Should the platinum price recede in the second half of the year […] then the top of the cost curve could become marginal once again.”

Platinum surpassed $1,400 per ounce to hit an 11-year high last week. “Following Friday’s close, and despite a large correction to end the week, platinum had risen more in the first six months of this year than gold did during 2024,” they said. “The price has now appreciated by 47% since 1 January.”

After trading as high as $1,375.21 overnight, platinum prices sold off sharply on Monday morning.

Spot platinum last traded at $1,330.42 per ounce for a loss of 0.63% on the session.