Silver

Silver Global Market Outlook

• In 2022, the global industrial demand is expected to rise by 6 percent, recovering from the disruptions induced by COVID lockdown restrictions. The logistic bottlenecks were the huge challenge for the export and import of silver, like increase in the freight costs and transportation complexities between Europe and East Asia

• Asia-Pacific and North America regions will continue to dominate the market, in terms of growth prospects in the long term. The increase in exploration activities in Central and Southern America will aid in ensuring supply security in long term

Silver Global Market Overview: Production and Consumption

• The inability of supply to outpace demand, the historical price imbalance of silver, and broader macroeconomic tendencies all point to silver's enormous potential for long-term development

• To reach 843.2Moz in 2022, it is estimated that global silver production will increase by 2.5 percent y-o-y, mostly due to increased output from Mexican mines. This will be fueled by increased production from primary silver mines, especially from many sizable current operations, and backed by the startup of sizable new projects. In 2022, it is estimated that the overall silver supply would increase by 3.3 percent to 1030.3 Moz

• The end-use segments of silver include electricals and electronics, jewelry, brazing and soldering, photography, net physical investment in bars and coins, net hedging demand, silverware and other industrial segments. In 2022, it is estimated that silver consumption would be increased by 5 percent Y-o-Y to 1101.8 Moz

• The growth of electric vehicles segment is faster than expected, which again is dependent on silver, and this growth correlates with the energy transition trend all over the world, especially in the European region. Alongside, post COVID growth is rebounded in silver jewelry and photography segments

Silver Global Market Overview: Regional Break-up

• After four consecutive declines, global silver mine production started to recover beginning 2021 onwards by reaching 822.6 Moz, which was 5.3 percent rise from 2020 production levels. Peru and Mexico would be the significant contributors for the increase in the mine production of 2021

• A significant growth in silver mine production is expected in countries, like Mexico, Canada, and Chile. However, silver production losses in Peru is due to the ongoing strikes and protests that would negatively impact the mining production levels and the Russian–Ukraine crisis would impact the production activity in Russia

• Silver production increased by 5.8 percent and 5.1 percent, respectively, from gold and lead-zinc mines as a result of the pandemic-related disruption. In 2021, Mexico produced the most silver, followed by China, Peru, Australia, and Poland

Silver Price Trend and Forecast

Price Overview

• COMEX Silver prices continue to trade with positive momentum and settled higher by 1.5% to USD 23.72 per troy ounce in January 2023.

• Silver prices remain supported by a weaker dollar and comments from Federal Reserve Chair Jerome Powell, while markets awaited more economic data for guidance on future rate hikes.

• However, prices increase was limited due to recession concerns, as investors worried about low demand for the metal from the industrial sector.