30 September 2024
While gold has been stealing all the headlines and limelight, with its impressive +25% year-to-date performance, silver has been quietly and steadily racking up stellar gains in its own right.
How much has silver gained since the start of the year?
Silver is up an astonishing 30%.
In fact, this year, silver has topped the $30 an ounce level for the first time in a decade.
Surprising? Not really, when you consider the insatiable demand that the manufacturing industry has for silver within the solar, electronics and automotive markets.
Silver is benefiting from its so-called “dual demand” stream. Investors buy silver as an investment to protect and grow their wealth and manufacturers buy silver to produce a wide variety of products from solar panels to medical devices.
“From electrical switches and solar panels to chemical-producing catalysts, silver is an essential component in many industries. Its unique properties make it nearly impossible to substitute, and its uses span a wide range of applications,” the Silver Institute said. “Almost every computer, mobile phone, automobile and appliance contains silver. It is the perfect substance for coating electrical contacts—like those in printed circuit boards—because of its high electrical conductivity and durability. Painting silver ink on any non-metal surface provides an electrical pathway, eliminating the need for wires.”
Silver Demand Exceeds Supply
As industry discovers more and more uses for silver in manufacturing, it has created more demand for silver than there is supply.
In 2023, silver demand greatly exceeded silver supply (for the third year in a row), with a deficit of 184.3 million ounces, the Silver Institute said.
This year, the global silver deficit is forecast to increase to 215.3 million ounces, with an expected 2% growth in demand combined with a 1% decline in supply.
This Adds Up To Higher Silver Prices Ahead
Not only is silver poised to climb alongside gold over the next year as the Federal Reserve lowers interest rates, but strong industrial demand will keep the silver market tight.
Swiss banking giant UBS forecasts silver prices at $36 per ounce by March 2025 and $38 per ounce by June 2025. J.P. Morgan, is also upbeat on the prospects for silver ahead with an average silver forecast of $36 per ounce by 2025, supported by “strong macro fundamentals and a supportive supply and demand backdrop.”
Following the global financial crisis in 2007-2009, silver climbed to almost $50 an ounce. Do you own enough?
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