For the first time in 14 years, silver mine production dropped
globally, according to World Silver Survey 2017, released May
11 by The Silver Institute.
The 0.6 percent decline in 2016 to a total of 885.8 million troy
ounces was the result of lower lead, zinc and gold mining from which
silver is a byproduct.
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“Coupled with less silver scrap supply to the market, which posted
its lowest level since 1996, as well as a contraction in producer
hedging, total silver supply decreased by 32.6 million ounce in 2016,”
according to the survey. Reductions in lead, zinc and gold mine
production accounted for 15.9 million ounces of that total, according
to the survey.
The 104-page survey was produced on behalf of The
Silver Institute by the GFMS Team at Thomson Reuters.
Despite higher silver prices, silver scrap supply fell to 139.7
Demand for silver coins and bars dropped in 2016 to 206.8 million
troy ounces, from 290.7 million ounces in 2015.
“The annual average silver price posted an impressive 9.3 percent
increase in 2016, its first rise since 2011,” according to The Silver
Institute. “Assisting the price was last year’s supply and demand
scenario, which led to another annual silver market deficit, the
largest in three years and the third largest on record, reaching 147.5
million ounces. The average price last year, at US$17.14, registered
28 percent higher than 2007, when the silver price averaged US$13.38.”