Along with gold and silver, platinum is a recognized investment precious
metal which is fabricated in the form of high quality bullion bars and bullion
coins by some of the world's leading precious metals refineries and
mints.
Importantly, as a recognized investment precious metal, platinum bars and
platinum coins from these refineries and mints are exempt from Singapore's
Good and Services Tax (GST). This means that there is no GST to pay when you
buy platinum bars and coins from BullionStar in Singapore.
Platinum's High Intrinsic Value
Like gold, platinum is relatively scarce and has a relatively high
intrinsic value and market value. And like gold and silver, platinum also has
many industrial and technological applications. Platinum's value is thus
based on a combination of its scarcity of supply and also on its physical and
chemical properties. These properties in turn drive the diverse global demand
sources for platinum across sectors such as the automotive, industrial and
jewelry industries in addition to the investment sector.
For example, platinum has well-known catalytic properties which allow it
to speed up chemical reactions without it being altered in the process. Hence
platinum is used in autocatalysts, in the chemical industry and in fuel
cells. Platinum is also a very strong attractive metal that does not corrode
and that is both ductile and malleable, hence it is a very popular precious
metal in the jewelry industry. Since platinum is resistant to corrosion and
oxidation, it is classified, along with a small number of other metallic
elements, as a noble metal.
Platinum - A Noble Metal
Platinum is a relatively scarce metal in the earth's crust and even rarer
than gold. In contrast to gold, annual platinum supply and platinum demand is
far lower than annual supply and demand in the gold market. According to
Thomson Reuters GFMS, supply of platinum in 2016 totaled 7661,000 ozs (238
tonnes) of which 188 tonnes came from platinum mining with a further 50
tonnes was derived from autocatalyst and platinum jewellery scrap recycling.
Within platinum extraction and mining, over 70% of global mine supply
comes from South Africa, with a further 12% from Russia, 7% from North
America, and the remaining 10 - 11% from elsewhere. South Africa's dominance
of global platinum supply is also evident in the composition of the
recently established World
Platinum Investment Council (WPIC) which is a platinum investing
advocacy association founded by six South African platinum mining companies,
namely Anglo-American, Lonmin, Implats, Aquarius, Northam, and Royal
Bafokeng.
On a country specific basis, platinum mining's concentration in a handful
of countries can sometimes set up supply shocks, for example, platinum mining
strikes in South Africa or geo-political risks/sanctions concerning Russia.
These shocks can at times affect platinum prices to the upside.
On the demand side, according to GFMS, autocatalysts are the largest
global demand driver for platinum. For example, autocatalysts accounted for
102 tonnes of platinum demand in 2016 followed by jewellery (68 tonnes) and
other industrial applications (57 tonnes), with investment (bars, coins and
platinum-backed Exchange Traded Funds) accounting for the remaining 16.8
tonnes.
Note that in its pure form, platinum is available as platinum grains (used
in the jewelry sector) and as platinum sponge (used in industrial
applications) in addition to platinum bars and coins. However, other forms of
platinum are designed for further onward processing and should not be
confused with investment-grade platinum. For investment and storage purposes,
refineries and mints will always produce platinum in the form of platinum
bars and platinum coins, and furthermore, only bars and coins from recognized
refineries and mints can be classified as investment precious metals and be
exempt from Goods and Services Tax (GST).
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Heraeus Minted Platinum
Bars
Singapore GST Exemption for Investment Platinum Bars and Coins
Since October 2012, the Singaporean Government has exempted Investment
Precious Metals (IPM) from Singapore's Goods and Services Tax (GST). To
qualify as IPM, precious metals must be in the form of a bar, ingot, wafer or
coin which meets specific criteria. Platinum bars qualify as IPM in Singapore
if the platinum bar has a platinum purity of at least 99%, can be traded on
an international bullion market, and is produced by a platinum refiner listed
on the current or former Good
Delivery list of the London Platinum and Palladium Market (LPPM).
The LPPM is a London-based trade association for the global wholesale
platinum and palladium markets. There are currently more than 30 refineries
on the current LPPM Good
Delivery List for Platinum including such refineries as Heraeus of
Germany, Johnson Matthey of the UK, and the four large Swiss precious metals
refineries Argor-Heraeus, PAMP, Valcambi, and Metalor.
Investment grade platinum bars produced by accredited refiners will
generally carry the name of the refiner or refiner stamp or brand on the bar.
If a refinery has the LPPM accreditation, the Singaporean IPM rules assume
that the refinery's bars are capable of being traded on an international
bullion market. Some platinum bars may in turn bear the name of a specific
bank such as Credit Suisse or UBS. These bars are known as bank-branded bars
and these bars also qualify as IPM if produced by a refiner on the LPPM Good
Delivery List.
For platinum coins, a GST exemption applies if the coin is a bullion coin,
has a platinum purity of at least 99%, and is listed on the GST schedule list
of qualifying coins. Qualifying platinum coins include:
- Royal Mint Platinum Canadian Maple Leaf
- US Mint Platinum American Eagle
- Austrian Mint Platinum Philharmonic
- Perth Mint Platinum Platypus and Platinum Koala
- Royal Mint Platinum Britannia, Platinum Lunar and
Platinum Queens Beast
Physical platinum investment bars and coins are very popular in markets
such as the US, Japan, China and the rest of Asia, and the market is a
growing one on the back of the existing popularity of high quality platinum
jewelry in these markets.
Platinum Bullion Bars
BullionStar's range of investment grade platinum bars is extensive and
features platinum bars in a number of weights from the world's most
prestigious platinum refineries. All platinum bars offered by BullionStar are
exempt from Singapore's Goods and Services Tax as all bars have a
platinum purity of 99.95% and are fabricated by platinum refineries such as
Valcambi of Switzerland, Heraeus of Germany, and Argor-Heraeus of
Switzerland. All of these refineries are listed on the current LPPM Good
Delivery List for Platinum and additionally all of these refineries are also
full members of the LPPM. Popular weights for platinum bars stocked by
BullionStar include 1 kilogram, 500 grams, 100 grams and 1 oz.
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Credit Suisse
minted Platinum bar
For example, Valcambi produces
a 1 oz minted platinum bar which is presented in its own secure blister
pack which doubles as the bar's assay card. The Heraeus refinery of Germany
produces minted platinum bars in a range of weights from a 100
gram minted platinum bar, through 500 gram
minted platinum bars, and up to a 1
kilogram platinum bar. Swiss refiner Argor-Heraeus, now fully owned by
Heraeus of Germany, fabricates its own minted platinum bars with the
distinctive Argor-Heraeus logo, for example the Argor-Heraeus
1 kilogram minted platinum bar.
BullionStar at times also carries bank-branded platinum bars, such as a Credit
Suisse 100 gram platinum bar which has been produced by Swiss refiner
Valcambi on behalf of the Swiss Bank Credit Suisse. These platinum bars are
also GST exempt in Singapore as they have been fabricated by a refiner, Valcambi,
which is on the LPPM Good Delivery List for Platinum. Valcambi has in the
past had a very close connection with Credit Suisse and was at various stages
both fully-owned and partially owned by Credit Suisse.
Platinum Bullion Coins
Most of the world's best-known national precious metals mints produce a
bullion coin in pure platinum. These include platinum coins from the Royal
Canadian Mint (RCM), Austrian Mint, US Mint, and the Perth Mint. All of these
mints are fully owned by their respective national governments and all of
these mints stand over the authenticity and quality of their bullion coin
products.
Some platinum bullion coins are produced every year, and some are produced
with more sporadic production runs. Many of the bullion platinum coins offered
by BullionStar are in similar designs to their gold and silver coin
counterparts and are issued in the convenient and standard 1 ounce weight.
All of these platinum bullion coins are also legal tender (non-circulating)
in their countries of issue.
For example, the Royal Canadian Mint produces a 1 ounce Platinum Maple
Leaf with the distinctive maple leaf design. This design will be familiar to
investors in the Royal Canadian Mint's Gold Maple Leaf and Silver Maple Leaf
coins. RCM Platinum Maple Leafs are produced on an annual basis, including
the years 2018,
2017,
and 2016.
Royal
Canadian Mint 1 oz platinum Maple Leaf
The Austrian
Mint also issues a 1
oz Platinum Philharmonic bullion coin each year which is intricately
designed with highly-stylized motifs celebrating the world-famous Vienna
Philharmonic orchestra.
Those who invest in silver and gold Eagle bullion coins from the US Mint
will also be interested in the US Mint's flagship 1
oz Platinum Eagle bullion coin which is handsomely designed with
imagery of the Statue of Liberty and a soaring American Eagle. The Platinum
Eagle, which was first released in 1997, is the only platinum coin ever
officially issued by the US, and has the highest face value (US $100) ever to
appear on any US coin.
The Perth Mint's has produced a number of platinum bullion coins over the
years although not in all sequential years. From 1988 to 2000, the Perth Mint
issued a Platinum Koala bullion coin in a number of weight denominations.
Then in 2011, the Mint began issuing its flagship 1
oz Australian Platypus Platinum coin. Production of the Platypus Platinum
coin continued until 2017 when it was superseded by the Perth Mint's
Australian Platinum Kangaroo coin 1 oz bullion coin.
Another option offered by BullionStar for those who wish to begin saving
and investing in platinum is the Bullion
Savings Program (BSP). With BullionStar's BSP, customers purchase grams
of platinum, gold or silver which are fully-backed by physical precious
metals held in BullionStar's stock inventory. These metal grams are available
for a low price premium and low spread and are therefore a cost-efficient way
to begin saving in precious metals. The metal grams can also be converted in
precious metals bars once sufficient grams have been accumulated.
For example, with the Platinum
Bullion Savings Program, customers can purchase grams of platinum
that are fully backed by platinum held in BullionStar's inventory. BSP
platinum grams have a low-cost storage fee, and can be converted into 1 kg
Heraeus Platinum bars at no extra cost. These bars can then be held by
customers in BullionStar's Vault
Storage, or physically withdrawn and delivered. Alternatively, investors
in BSP platinum grams can sell their platinum grams back to BullionStar at
any time.