Physical Silver Demand is Record High

• Schiffgold: Silver Demand on Pace for Record Year
• InvestingHaven: Silver: A Divergence Of Epic And Historic Proportions

Image: InvestingHaven

Schiffgold: Silver Demand on Pace for a Record Year

Silver demand is on pace to hit record levels in 2022, driven by new highs for physical investment, industrial demand, jewelry, and silverware production, according to the Silver Institute’s Interim Silver Market Review according to Schiffgold.
Global silver demand is projected to reach a new high of 1.21 billion ounces in 2022. That would be a 16% increase from 2021.

Institutional demand for silver has been slow due to rising interest rates with Federal Reserve’s inflation fight, which has led to a decrease in silver ETF holdings. However, demand for physical silver has been robust, and physical investment demand is on pace to jump by 18% to 329 million ounces this year. According to the Silver Institute, support has come from investor fears of high inflation, the Russia-Ukraine war, recessionary concerns, mistrust in government, and buying on price dips. The rise was boosted further by a of Indian demand, a recovery from a slump last year, with investors often taking advantage of lower rupee prices.

Signs of this high demand in the rapidly decreasing levels of silver has been visible in COMEX vaults. Industrial demand makes up more than 60% of silver usage each year. It is on track to set a new record of 539 million ounces in 2022.

The push for green energy has helped drive industrial demand higher with more and more silver being used to produce solar panels. The electrification of vehicles is also boosting demand, along with the adoption of 5G technologies. According to the Silver Institute, demand in these emerging markets has helped silver overcome macroeconomic slow-downs while the global economy has slowed.

Demand for silver jewelry and silverware is projected to surge by 29% and 72% respectively. Jewelry production will use about 235 million ounces and silverware fabrication will consume another 73 million ounces this year.

21 Nov 2022 Schiffgold

InvestingHaven: A Divergence Of Epic And Historic Proportions in the Global Silver Market

Data points suggest that silver will turn bullish in the near future, according to InvestingHaven. This robust rise might start early 2023 or near the end of 2023. Silver is expected to be on the rise more than gold. The supply/demand imbalance in the silver market in 2022 is shaping up to be of epic and historic proportions. The Silver Institute forecasts global silver demand reaching record highs in 2022.

The global silver market is forecast to record a second consecutive deficit this year. This will be a multi-decade high and four times the level seen in 2021. More specifically, the article looks at the different types of demand in the silver market. Physical investment in 2022 is on track to jump by 18%, which would also be a new record.

Support has arisen from investor fears of high inflation, the Russia-Ukraine war, recessionary concerns, mistrust in government, and buying on price dips. The rise was boosted further by a of Indian demand, a recovery from a slump last year, with investors often taking advantage of lower rupee prices.

This physical market imbalance is historic, and it is considered more significant than simply a major supply shortage jump of 4x against last year. Sooner or later, price should adjust to this reality, says InvestingHaven – even though the physical silver market may not be the ultimate catalyst of the silver price. The catalyst is the silver futures market.

20 Nov 2022 InvestingHaven