2016 Silver Market Trends
News
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Posted 04/02/2016
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The Silver Institute has just released their Market Trends report for 2016 and we summarise as follows:
Demand:
Industrial – accounted for 54% of demand in 2015 and is set to increase again in 2016.
Photovoltaics (PV) – set to surpass the 2011 record of 75.8m oz in 2016 and account for 13% of silver demand.
Ethylene Oxide (EO) – this is the big growth area. Set to increase 25% (10m oz) this year over 2015 which itself saw 40% growth.
Jewellery – set to increase 5% in 2016 after a slight decline in 2015.
Coins – already off at a cracking pace it is expected to remain similar to the record year last year of 130m oz, which accounted for 12% of physical demand.
ETFs – holdings for physical metal backing paper fell 2.8% in 2015. They don’t really make a call as it will be market dependent…
India – gets a special mention as they imported a whopping 228m oz of silver last year and are expected to continue this pace in 2016.
Supply:
Mine supply – expected to drop 5% in 2016 and continue to drop to 2019. 2016 will be the first year of reduced supply since 2002. [this is in line with various articles we’ve written about 2015 being the year of peak gold and silver].
Scrap – further weakening as has been the case for several years.
Deficit:
“The silver market deficit (total supply less total demand) is expected to widen in 2016, drawing down on above-ground stocks. The larger deficit is expected to be driven by a contraction in supply.”