Higher silver supply to reduce global deficit by 4% in 2024
Silver market faces fourth year of structural deficit
Metals Focus expects silver market deficit to persist
Industrial demand to rise by 7% in 2024
LONDON, Nov 13 (Reuters) -The global silver deficit is expected to fall by 4% to 182 million ounces in 2024, with growth of 2% in total supply offsetting demand growth of 1%, the Silver Institute industry association said on Wednesday.
Silver, used in jewellery, electronics, electric vehicles and solar panels as well as an investment, faces the fourth year of a structural market deficit, the Silver Institute said in a review prepared with consultancy Metals Focus.
Record industrial demand and a recovery in jewellery consumption will lift demand to 1.21 billion ounces in 2024 despite a 16% decrease in physical investment, according to the review.
Mine supply is expected to rise by 1% led by higher production in Mexico, Chile and the United States, while recycling will add 5% due to a spike in western silverware scrap.
With spot silver prices XAG= up 32% so far this year amid gold's rally and improved outlook for industrial demand, exchange-traded products (ETPs) are on track for their first annual inflows in three years, according to the review.
SILVER SUPPLY & DEMAND* (million troy ounces)
2022 | 2023 | 2024F | Change 2023/22 | Change 2024/23 | |
SUPPLY | |||||
Mine production | 839.4 | 828.9 | 836.6 | -1% | 1% |
Recycling | 177.0 | 178.8 | 188.0 | 1% | 5% |
Total supply | 1,018.2 | 1,009.3 | 1,026.0 | -1% | 2% |
DEMAND | |||||
Total industrial: | 588.3 | 654.7 | 700.2 | 11% | 7% |
- Electrical & Electronics | 370.5 | 444.3 | 474.2 | 20% | 7% |
…of which photovoltaics | 118.1 | 192.7 | 203.4 | 63% | 6% |
Jewellery | 234.5 | 203.1 | 212.4 | -13% | 5% |
Silverware | 73.5 | 55.2 | 58.0 | -25% | 5% |
Bar/coin demand | 337.1 | 245.8 | 208.4 | -27% | -15% |
Net hedging demand | 17.9 | 12.4 | 2.8 | -31% | -77% |
Total demand | 1,278.9 | 1,198.2 | 1,208.0 | -6% | 1% |
Market balance | -260.7 | -188.9 | -181.9 | -28% | -4% |
ETPs | -125.8 | -42.1 | 100.0 | -67% | n/a |
Market balance less ETPs | -134.9 | -146.8 | -281.9 | 9% | 92% |
*Source: Metals Focus for the Silver Institute
Reporting by Polina Devitt; Editing by Louise Heavens
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