Precious Metals

Demand for silver expected to rise worldwide

The silver market supply in 2024 is expected to remain in a deficit for the fourth straight year, according to Metals Focus analysts’ report to The Silver Institute.

Image courtesy of The Silver Institute.

Demand for silver globally during calendar year 2024 is projected by analysts at Metals Focus to reach 1.2 billion ounces.

The analysts note that the number, if reached, would be the second highest demand level recorded for the precious metal. The report was prepared  for The Silver Institute, a silver industry public relations and market reporting association.

Metals Focus is a global precious metals research consultancy based in London, England.

Silver industrial fabrication is projected to post a 4% rise to reach 690 million ounces.

“Jewelry demand is expected to record a 6 percent rise, and India will contribute the bulk of gains this year,” according to the Metals Focus analysis. “This follows a sharp pull back in 2022 when Indian demand weakened after a post-COVID surge in 2021.”

Silver supply

Silver mine production in 2024 is anticipated to increase 4% to 843 million ounces, the highest level in six years.

They further project: “Total global silver supply is forecast to grow by three percent in 2024 to an eight-year high of 1.02 billion ounces, entirely led by a recovery in mine output.”

“The silver market is forecast to remain in a deficit (total supply less demand) in 2024, marking the fourth consecutive year of a structural market deficit. Although this year’s deficit is expected to ease by 9 percent to 176 [million ounces] (194 [million ounces] in 2023), it will still be exceptionally high by historical standards,” according to Metals Focus.

Silver investment

Early 2024 witnessed financial markets scaling back their expectations of U.S. interest rate cuts, as many investors once believed this would start as soon as March, according to analysts.

“... Market expectations of U.S. interest rate cuts are still a little more dovish compared with the Federal Reserve’s more hawkish position,” the Metals Focus market analysts reported.

“Once the Fed starts to cut rates,” the report continued, “most likely in mid-2024, silver investment should begin to recover.”

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