Rhodium prices forecast to rise 62% in 2026 as structural supply deficits persist: Metals Focus

Rhodium prices are set to rise 62% in 2026 as persistent structural supply deficits and slower-than-expected electric vehicle adoption tighten the platinum group metals market, according to the Metals Focus 2026 PGM Market Report published May 18. The forecast positions rhodium as the second-best performing PGM after platinum (forecast up 71%), significantly outpacing palladium (forecast up 37%). (FACT: Metals Focus, via Mining.com, May 18, 2026)

The PGM complex has undergone a fundamental regime change. The basket price of platinum group metals broke out from its long-term trading range in 2025, and unlike previous rallies that faded within quarters, current conditions reflect years of accumulating supply deficits. Rhodium alone is up 83% compared with a year ago, while ruthenium has surged 158% over the same period. Even after multi-year highs in early 2026 that were followed by a correction as a gold-led rally faded and the Iran war weighed on investment sentiment, the structural underpinning of the market remains intact. (FACT: Metals Focus, via ValueTheMarkets, May 19, 2026)

Wilma Swarts, PGMs director at Metals Focus, observed that "aside from the Covid pandemic, when we saw sporadic breakouts in these metals, the entire complex has effectively shifted higher." The critical driver, Swarts noted, is that the growth of PGM-free electric vehicles has so far turned out to be less dramatic than the market had priced in over 2022–2024. Hybrid vehicles — which still require full catalytic converter systems including rhodium — continue to command significant market share, while the pace of battery electric vehicle adoption has moderated in key markets including Europe and the US. (FACT: Mining.com, May 18, 2026)

Years of structural supply deficits — meaning the market has consumed more metal than miners produce for an extended period — are the engine behind the current tightness. This dynamic is visible in London lease rates, which remain elevated after extreme spikes in 2025 when tariff concerns prompted metal outflows from London to US stocks. The supply side shows no near-term relief: even though higher PGM prices in 2025 more than doubled all-in sustaining cost margins for South African and Russian producers to a three-year high, the capacity to ramp up production remains severely limited. Mine expansions require 5–10 years from decision to first production, and the project pipeline across the PGM industry is thin. (FACT: Mining.com, May 18, 2026)

South Africa remains the critical swing factor. The country accounts for approximately 80% of global rhodium production, and any disruption — whether from power shortages, labour disputes, sanctions, or weaker mine output — immediately affects global availability. Metals Focus flagged that while production costs in South Africa and Russia have risen, the improvement in PGM prices has been sufficient to restore margins, but the mining sector still has limited ability to respond with meaningful volume growth. (FACT: Metals Focus, via ValueTheMarkets and Mining.com, May 18-19, 2026)

The rhodium-specific outlook is nuanced by the metal's extreme volatility profile. Rhodium's market balance oscillates sharply between deficit and surplus depending on autocatalyst loading rates and South African production levels. Metals Focus assesses that current conditions remain consistent with a deficit environment, underpinning the projected 62% price appreciation. However, the consultancy notes that the key risk to the rhodium thesis is bidirectional: an unexpected surplus driven by reduced autocatalyst demand or improved South African output could reverse gains with the same speed that deficits generate them. (FACT: Discovery Alert, May 18, 2026)

Heraeus Precious Metals, in its 2026 forecast published in late 2025, took a more cautious view, projecting that rhodium could transition from a small deficit to a small surplus in 2026 with automotive demand falling around 5%. Heraeus forecast a rhodium price range of $6,000–$9,000/oz for 2026, citing declining ICE vehicle production and higher recycling rates as headwinds. (FACT: Heraeus Precious Metals, 2026 Forecast, via Mining Weekly and Ecotrade Group, Dec 2025 – May 2026) The divergence between the Metals Focus and Heraeus outlooks illustrates the unusually wide range of outcomes that rhodium's thin market can accommodate.

For context, rhodium spot prices were trading in the $9,600–$10,300/oz range as of late May 2026, according to Umicore pricing data, down from multi-year highs in early 2026 but still substantially above the $4,400–$4,750/oz levels seen in late 2024. The metal remains one of the most volatile commodities on earth, lacking a liquid futures market and trading almost exclusively through physical dealer transactions, which can gap significantly when supply or demand shifts. (FACT: Umicore 10am Price, May 22, 2026; FindBullionPrices.com, May 19, 2026)

The broader macroeconomic environment adds another layer of complexity. Higher oil prices linked to geopolitical tensions could accelerate EV adoption over time, reducing long-term rhodium demand from internal combustion engine catalysts. Conversely, the recent US-China tariff truce and any de-escalation of the Iran conflict could support industrial production and automotive sales, sustaining near-term rhodium demand. The interplay of these forces means that rhodium's 2026 trajectory will be determined as much by geopolitics as by mining output. (FACT: Metals Focus, via ValueTheMarkets, May 19, 2026)