The pressure building beneath the physical platinum market is only just beginning.
China may now be signalling what the real clearing price for platinum should be. Prices on Chinese exchanges are currently trading around US$250 per ounce above Western markets, and during the launch of the Guangzhou Futures Exchange (GFX) on the 27th November, platinum even traded at a premium of US$270 per ounce.
Such an extreme arbitrage can only do one thing: pull more physical platinum into China, further tightening an already severely undersupplied global market.
China has already established itself as the world’s largest consumer of platinum, spanning industrial applications, jewellery, automotive catalytic converters, hydrogen technologies, and investment demand. The country now sets the marginal bid for physical metal, and with that comes pricing power.
A Structural Shift: China Launches Physically Settled Platinum Futures
On 27 November, the Guangzhou Futures Exchange began trading physically settled platinum and palladium futures and options. Crucially, these contracts allow delivery not only of bars but also of platinum sponge, the preferred form for industrial and automotive end-users.
This is a major evolution: until now, exchanges worldwide only permitted delivery of ingots or bars.
According to Edward Sterck, Research Director at the World Platinum Investment Council, opening the GFX to international participation allows China’s real demand expectations to enter the global price-discovery process, a shift he describes as potentially “very beneficial to the market”.
Why Guangzhou Matters More Than the SGE
The Shanghai Gold Exchange (SGE) only facilitates one-way trading (buying and taking delivery).
Guangzhou, by contrast, supports two-way trade with physical settlement , making it vastly more attractive for industrial consumers, financial participants, and arbitrageurs. It is strategically positioned to become China’s true price-setting venue for platinum.
The Numbers: China Is Paying Real Physical Premiums
• SGE platinum price (25 Nov 2025):
¥410.57/gram ≈ US$1,804.08/oz
vs.
Western price: ~ US$1,554/oz
• Guangzhou Futures Exchange (27 Nov 2025):
¥430.30/gram ≈ US$1,890.77/oz
A premium of US$250 to 270 per ounce represents more than temporary dislocation, it reflects genuine physical scarcity.
Conclusion: China May Be Exposing a Major Mispricing
The persistent premium suggests that Western futures markets may no longer reflect the true cost of acquiring physical platinum.
With China pulling in more metal, structural deficits widening, and new physical delivery mechanisms coming online, platinum’s global supply chain is under far more strain than markets currently acknowledge.
In short:
China may have just fired the starting gun on platinum’s repricing, and the squeeze is only beginning.