Publication of the Silver Institute’s Intermediate Silver Market Review

Global Silver Demand Reaches New High in 2022

Silver jewelry and physical investment are both expected to increase
of 50 Moz to reach records this year

NEW YORK, Nov. 17, 2022 (GLOBE NEWSWIRE) — Silver demand is expected to reach a record total in 2022, driven by new highs for industrial demand, jewelry and silverware purchases, and physical investment . These are some of the key findings reported by Philip Newman, Managing Director of Metals Focus, and Adam Webb, Director of Mining Supply, during the Silver Institute’s Interim Silver Market Review in New York today. today, which presented historical supply and demand statistics and estimates for 2022. Here are the main highlights of the presentation:

• Global silver demand is expected to hit a new high of 1.21 billion ounces in 2022, up 16% from 2021. Every key demand segment except photography is expected to post a new peak.

• Industrial demand is on track to grow to 539 million ounces (Moz). Developments such as ongoing vehicle electrification (despite weak vehicle sales), growing adoption of 5G technologies, and government commitments to green infrastructure will enable industrial demand to ride out macroeconomic headwinds and the decline in consumer electronics demand.

• Physical investment in 2022 is on track to jump 18% to 329 Moz, which would also be a new record. Support came from investor fears of high inflation, the Russian-Ukrainian war, recession fears, distrust of government and buying on falling prices. The rise was further boosted by a (near-doubling) of Indian demand, a recovery from last year’s slump, with investors often taking advantage of lower rupee prices.

• Exchange-traded products, on the other hand, are expected to see the largest annual decline in holdings totaling 110 Moz, in part due to silver’s higher volatility than gold, which has made it more vulnerable to profit taking. Institutional investors should maintain a bearish stance as real yields are expected to strengthen, encouraging further distance from the white metal.

• This year, Metals Focus expects the average price of silver to fall 16% year-over-year to $21.00. Until November 7, prices fell by 14% over one year. Metals Focus expects the U.S. Fed to continue raising interest rates, raising the opportunity cost of precious metals, which, combined with rising yields and continued dollar strength, will continue to put pressure on silver prices. Additional stress will also come from the industrial nature of silver, as growing fears of a possible recession will weigh on sentiment, despite its extremely supportive fundamental backdrop.

• In 2022, mined silver production is expected to increase 1% year-over-year to 830 Moz. Mexico’s production will increase more significantly as several new large silver projects that have been commissioned in recent years continue to ramp up. Silver production as a by-product from existing mines and new projects in Chile will also be a major contributor to growth. These increases will be partially offset by lower production from major silver producers such as Peru, China and Russia. Rising inflation, particularly due to higher oil and natural gas prices, has put significant upward pressure on miner costs in 2022. However, in the first half of the year, the Silver miners’ rising operating costs have been outpaced by rising by-product revenues. As a result, the average aggregate sustaining cost (AISC) in H1.22 fell 10% YoY to $9.72/oz. By-product metal prices fell in the second half of the year and as a result silver miner costs are expected to rise in H2.22.

• Silver jewelry and silverware are expected to jump 29% and 72% to 235 Moz and 73 Moz respectively this year, driven mainly by an unprecedented rebound in Indian demand. This is partly due to a strong replenishment of inventory ahead of the holiday and wedding season, following a significant depletion of inventory in 2021.

• The global silver market is expected to register a second consecutive deficit this year. At 194 Moz, that will be a multi-decade high and four times the level seen in 2021.

The story continues

Disclaimer and Copyright. The Silver Institute and Metals Focus
This press release should not be construed as a solicitation or offer to buy or sell silver or any related products, securities or investments, nor does it constitute advice regarding the purchase or the sale of these. Accordingly, you should seek professional or specialist investment advice before taking or refraining from taking any action relating to the content of this press release.

This press release contains forward-looking statements. Forward-looking statements are based on information and assumptions that the Silver Institute and Metals Focus had at the time such statements are made or on their good faith belief at that time regarding future events. Forward-looking statements are subject to risks and uncertainties that could cause actual performance or results to differ materially from those contained or implied by the forward-looking statements. Although great care has been taken in the preparation of the information published in this press release, the content is provided without any warranties, conditions or warranties as to its accuracy, completeness or reliability. The Silver Institute and Metals Focus assume no responsibility for updating forward-looking statements, accept no responsibility for any errors or omissions, and accept no liability for any loss or damage arising, or to any third party at regard to this document.

Press contact details
Michel DiRienzo
The silver institute
Phone: +1.202.495.4030
Email: mdirienzo@silverinstitute.org

Philip Newman
Focus on metals
Telephone: +44.20.3301.650
Email: philip.newman@metalsfocus.com