Sirwin
Sirwin
Spot Silver - November 22, 2022

This Year's 194 Million Ounce Silver Deficit To Push Prices Higher?


New highs for physical investment, jewelry and industrial uses for things like solar panels, cell phones and silverware are pushing silver demand to a new record by the end of the year to 1.21 billion ounces, representing a 16% increase from just a year ago.

Indian demand saw an inflow of almost double from last year. Fears of higher inflation, mistrust in government, the Ukraine war among other things are fueling demand among investors while industrial demand is set to hit a new record of about 539 million ounces or more than 60% of the overall total. The 'electrification' of our world from automobiles to 5G towers are pushing industrial demand ever higher.

The jewelry industry is set to consume some 235 million ounces while silverware fabrication will consume about 73 million ounces. Physical investment coming in at a total of 329 million ounces, is a whopping 18% increase from the year before.

While demand for silver increases, mine output is expected to increase by only 1%.  As a result, the silver market is projected to record a multi-decade high deficit of 194 million ounces, about 4 times the deficit seen in 2021.

Something else to keep an eye on is the silver to gold ratio which is at about 83:1 at time of writing. This means it takes 83 ounces of silver to buy one ounce of gold. On average, over the last few decades, the ratio hovered between 40:1 and 50:1 however, there have been a few times when it dropped considerably.

In 2011, when silver almost breached its 1980 high of $50, the ratio hit 30:1 while back in late 1979 / 1980, the ratio went as low as 20:1. 

The information above, along with all the uncertainty ahead of us suggest higher silver prices are coming our way. Yet, silver is still just $21 spot. This presents an unprecedented opportunity. Mind you, the retail markups are exploding higher too.

One way to avoid the markups is to invest in shares of a 1,000 ounce bar as offered by OwnX, of which I am a loyal customer. You can cash out anytime in whatever amount you like or trade for physical silver bars, rounds and coins for delivery. By being a co-owner of a 1,000 ounce bar, you can buy at spot prices for gold, silver, platinum and / or palladium and get much more precious metal for your dollars.

Silver has proven to be a great hedge against all this 'transitory' inflation that isn't going away and only getting worse. A Canadian 'Silver Maple' coin can fetch over 40 Canadian dollars while just as the pandemic hit in March 2020, the silver gold ratio went over 120:1, one Silver Maple could be bought for less than $25. Now it can fetch over $40, representing about 60% increase.

Now that's what I call an INFLATION BUSTER! 

 

I earn free Bitcoin Satoshis using CryptoTab Browser. I also use the BAT browser to earn free BAT tokens on my cell phone. Zero investments were made to earn these tokens and the risk is minimal at best. Silver though, is my ultimate back up plan as the S&%t hits the fan. Consider investing in silver and / or gold. Click here for more info and purchase any precious metal at OwnX.

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Check out some of my previous posts.

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USAWatchDog's Greg Hunter interview with Jim Rickards.

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Bix Weir interviews Clif High / Greg Hunter interviews Bix Weir.

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A fan of history? Check out my other blog, 'A brief history of...'

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SweptOverNiagara
SweptOverNiagara

Name's Joe and I live in Ontario, Canada. I like writing on a wide variety of topics. I enjoy keeping track of markets, investing and commodities and the crypto sector. Also do some coding for web browsers.


The Brave New World
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