The futures price for silver bullion settled at $17.497 an ounce on February 12, having fallen more than 2% this year. Silver has not performed as well as gold, whose future prices have risen by almost 3% over the same period. The US currency was stronger than in previous years and, like gold, silver has begun a steady shift away from the white metal.
Although it is often overlooked in favour of its shiny cousin, gold, the silver price last year jumped more than 70% and commodity strategists say the rally is likely to continue when the global economy reopens. The silver market experienced a historic resurgence in 2020, with prices doubling after falling to a 12-year low of $12 an ounce in March. According to the aubullion, which has published an outlook for the global silver market in 2020, markets are likely to see this year a continued increase in physical silver investment due to the use of raw materials as an industrial metal.
Recall that a year ago, on March 17, 2020, the price of silver closed at $1,277 an ounce. After closing at $2,637 an ounce on March 17, 2021, the silver opportunities has risen an astonishing 1,065% this year.
Most industry analysts predict the price of silver will rise this year, with five predicting it will stay above $30.
The bank said it sees silver averaging $2,913 an ounce next year, with prices rising as high as $31 an ounce. Metal Focus analysts see the price of silver rising to $30 an ounce next year.
According to the Silver Institute, total supply has increased by 8% this year, while total demand has increased by up to 15%, led by physical demand in industry and jewelry. Demand for silver from industrial production will not slow down, and to satisfy this demand, demand is the only available source for mining investors. The growing problem of scarcity has sent silver prices soaring and convinced investors to sell their holdings to industrial users.
Believes that the bond that bonds silver to gold must be broken, but the reality is that most of the same factors that form the gold price will also move silver. If people are able to replace their jewelry demand with silver, and metal investors are convinced to sell at a higher price, industrial demand will be non-negotiable. When the price of gold rises, silver is ultimately labelled as a “market comparison” based on historical markets.
If you look at the current price charts for gold and silver in CAD, you will find that they have a strong relationship with each other. In order to move forward, it is helpful to take a look at the gold price drivers when attempting to understand the action of the silver price last year.
The rush of investors to hoard silver is continuing, since gold is seen as a safe place to store money according to the Institute, which predicts that purchases of bars and coins will hit a six-year high of 257 million ounces by 2021. Last year, investor demand for the metal recorded its biggest increase since 2015, rising 12 per cent to 1861 million ounces.
