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Executive summary

The circular economy advocates designing products to be more durable, repairable, and recyclable, maximizing the reuse of materials and therefore ensuring they are kept in circulation for as long as possible. It seeks to reduce waste and reinforces the importance of managing impacts and consuming fewer resources to deliver sustainable outcomes, lowering both demand for raw materials and the environmental impact associated with obtaining them.

Platinum is highly recyclable, and as products, which contain platinum or other platinum group metals (PGMs) reach their end-of-life, the PGM-content can be extracted through a process of smelting and refining. This provides a sustainable secondary source of supply of these limited natural resources.

Total annual platinum supply has tended to hover around the 8 Moz mark. Due to constraints affecting both total mined supply and recycling, this fell to 7.2 Moz in 2022. Last year, global recycling declined 17% year-on-year to 1.7 Moz. Automotive recycling fell by 20% to 1.2 Moz due to the lingering effects of the COVID-19 pandemic and other temporary challenges to the supply of spent autocatalysts, whereas jewellery recycling was impacted by lockdowns in China. Total platinum recycling supply is expected to recover by 10% in 2023, although it will remain below pre-COVID-19 levels.

Figure 1: Schematic of the global platinum market, based on 2023 forecasts

Of the 25% of total platinum supply that comes from recycling each year, circa 80% is from autocatalysts and circa 20% from jewellery. A small amount of recycled platinum also comes from electronic waste. The stream of secondary supply from recycling platinum is a function of historical platinum demand, although the time lag between original consumption and recycling can be long. On average, it is around 13 years for autocatalysts.

Platinum catalysts used in industrial processes that have been subject to depletion are also recycled and typically reused within the same process. In this instance, known as closed-loop recycling, ownership usually remains with the industrial user.

Sustainable metals management and the recycling of PGM-containing end-of-life products is becoming an increasingly important focus where platinum is used in the technological solutions needed to combat climate change. As these are scaled up, there is a growing emphasis on the need to ensure that the critical minerals required are supported by manufacturing processes and supply chains that are “circular”.  

Figure 2: Total platinum supply, 2022 vs 2023f

Autocatalyst recycling

The primary source of platinum recycling supply arises from autocatalysts when vehicles reach the end of their lives. Platinum is predominantly used in the autocatalysts of diesel cars and trucks, although its use in gasoline vehicles’ autocatalysts is growing as platinum is increasingly being used as a substitute for palladium on cost grounds. In 2022, almost 3 Moz of platinum was used in the manufacture of autocatalysts for vehicles.

Autocatalyst recycling follows the end-of-life vehicle scrappage profiles in various regions, and platinum supply from this source reflects the PGM loadings per used catalyst. This loading reflects the amount of metal necessary at the time the vehicle was produced to achieve the emissions level per region over time. This loading has a significant bearing on secondary platinum automotive recycling volumes and consequently the supply is relatively price inelastic. As the autocatalyst recycling industry has grown following the introduction of catalysts in the 1970s, it has become a mature business with largely fixed yet low margins. This is because the price paid for scrap catalysts is based on the metal content at market prices.

This also means that even at very low PGM prices end-of-life catalysts will always be processed and explains further the inelastic nature of this supply. Indeed, in Europe it is a legal requirement for spent autocatalysts to be processed. Over 90% of the platinum that goes into an autocatalyst in the first place is recovered.

Note also that recycling supply can be impacted by scrappage rates. For example, automotive recycling supply has reduced since the start of the COVID-19 pandemic as capacity constraints in the production of new vehicles have forced consumers to run existing vehicles for longer, rather than scrap them. This is expected to ease as new vehicle production volumes gradually improve.

Figure 3: Global automotive recycling volumes by quarter, 2019-2022 vs 2023 forecast quarterly average

Changing consumer behavior has also impacted autocatalyst recycling as cars are being driven for longer due to a trend towards lower annual mileage linked to increased working from home. The number of miles driven in 2022 fell by an estimated 10% in cities, and even more in urban areas. Furthermore, cost of living concerns have seen some consumers delay new vehicle purchases.

In the North American market, measures to reduce stolen catalysts entering the supply chain as a result of automotive theft had a temporary negative impact on autocatalyst recycling volumes towards the end of 2022. This is expected to abate quickly as the industry – which already has very robust processes in place – looks to introduce further mechanisms to improve confidence in the provenance of purchased spent catalysts.

Figure 4: Annual U.S. auto scrappage rates

Jewellery and other recycling

Recycled supply from other end-use sectors, such as jewellery and electronics, represent a smaller proportion of overall recycled supply. Jewellery recycling tends to follow sales volumes in China, which has a 55% market share of the platinum jewellery recycling industry. Electronic scrap is a minor component of overall platinum recycling supply.

Recycling from industrial applications, such as the manufacturing of glass fiber or platinum used as a catalyst in the manufacturing of petrochemicals, tends to be closed loop within companies and industries. As such, there is usually a limited amount of material that returns to the market, except for rare occasions when large facilities are permanently closed.

In 2022, jewellery recycling fell by 12% year-on-year to 3.7 Moz due to a 22% decline in China linked to the weak demand for new platinum jewellery – the market was especially impacted by ongoing COVID-19 pandemic-related lockdowns during the year. Recycling from electronic waste grew by 3%.

Platinum is a key metal for the energy transition due to its use in hydrogen fuel cells and proton exchange membrane (PEM) electrolysers to make green hydrogen. As these technological solutions are scaled up, there is a growing emphasis on the need to ensure that the critical minerals required are supported by manufacturing processes and supply chains that are “circular”.

The circular economy advocates designing products to be more durable, repairable, and recyclable, maximizing the reuse of materials and therefore ensuring they are kept in circulation for as long as possible. It seeks to reduce waste and reinforces the importance of managing impacts and consuming fewer resources to deliver sustainable outcomes, lowering both demand for raw materials and the environmental impact associated with obtaining them.

Recent developments are demonstrating how circularity is being considered as new hydrogen fuel cell and PEM electrolyser production capacity is being added, with metal recovery and recycling plans being built-in across the value chain from design and production to installation and maintenance.

For example, in China, which has limited natural resources in platinum group metals and strongly relies on imports, Johnson Matthey is working with Sinopec to explore possibilities across green and blue hydrogen, fuel cells, decarbonisation technologies, and business opportunities in the circular economy.

Meanwhile, BASF and Heraeus are collaborating to help improve resource utilization for high-tech and other companies that use precious metals, enabling a circular economy solution through the recycling of spent catalysts. The recovered precious metals will be used to make new products for the automotive, chemical, electronics, and green hydrogen industries. Both initiatives are helping to ensure a local supply of recycled precious metals for China.

In Europe, which has set ambitious green hydrogen production targets as part of its strategy to improve energy independence, Heraeus is working with the German Federal Ministry of Education and Research to develop a recovery and recycling strategy for iridium and platinum in PEM electrolysers. There are a number of specific challenges to be solved when recycling these scarce raw materials, including the return of precious metal-containing end-of-life electrodes from PEM electrolysers, as well as the question of how these electrodes can be processed into recyclable material at the necessary scale. Additionally, the further separation and purification of iridium is highly complex, requiring specialized technologies to achieve the highest possible recovery.

Heraeus’s work highlights how the circular economy gives existing end-users and those developing new technologies reassurance as to the long-term sustainability and security of platinum availability, allaying fears concerning the potential for eventual resource depletion. In addition, circularity contributes towards producers’ own efforts to improve sustainability and lower their environmental impact.

Outlook for recycling

Global recycling is expected to recover by 10% in 2023 to 1.9 Moz, largely reflecting expectations that the growth in new vehicle production will lead to a normalisation of end-of-life scrappage rates and thus the spent autocatalyst market, which is forecast to recover by 12% year-on-year to 1,391 koz, but still remain below pre-pandemic levels. With remote working and online shopping now established behavior, it is likely that cars will continue to be driven for longer before they are replaced.

Platinum jewellery recycling is expected to increase 6% as increases in China, mostly driven by fewer COVID-19-related disruptions, more than offset declines elsewhere. Electronic recycling is expected to show modest growth.

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