While the Federal Reserve pivots toward rate cuts and gold enters a consolidation phase, silver is staging a historic breakout. On Thursday, the metal’s price surged past the $64 per ounce threshold, a move that has more than doubled its value since the start of the year. This represents the most powerful 12-month performance the white metal has seen since 1979.
Key Metrics at a Glance:
* Current Price: Approximately $64 per ounce (€54.34)
* Year-to-Date Gain: Exceeds 100%
* Market Behavior: Any price dip is met with immediate buying pressure
* 2025 Forecast: A supply deficit of 95 million ounces
A Structural Supply Crisis Deepens
This explosive rally is fueled by a fundamental imbalance: global mine production is failing to meet worldwide consumption. Research from the Silver Institute and Metals Focus indicates 2025 will mark the fifth consecutive year of market deficit. Industrial applications are the primary demand driver, now accounting for 60% of total usage.
The photovoltaic sector is consuming ever-larger quantities. By 2025, an estimated 17% of all silver demand will originate from solar panel manufacturing—roughly 190 million ounces. This is a dramatic increase from a mere 6% share back in 2015.
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Concurrently, global stockpiles are being rapidly depleted. The drawdowns in China and at the COMEX exchange are particularly acute. Supply concerns have intensified further with reports that China may halt exports starting in January 2026. In October alone, a record 660 tonnes departed the country.
Financial Institutions Pile In
The financial sector is responding with what can be described as panic buying. Physically-backed silver ETFs witnessed inflows surpassing 15.3 million ounces in just four days, marking the second-largest weekly accumulation of the entire year.
This aggressive institutional purchasing has compressed the gold-to-silver ratio to between 69 and 72, its lowest level since August 2021. Silver is now significantly outperforming gold. Market strategists view this dynamic as a signal of stress within the financial system, with silver’s industrial demand profile providing additional leverage.
Physical Availability Takes Command
Market conditions are exceptionally tight. From a technical analysis perspective, the decisive break above $60 has unlocked substantial upward momentum, attracting speculative capital. With the looming threat of Chinese export restrictions and relentless demand from the energy transition, price discovery is increasingly dictated by tangible metal availability. The influence of the paper market is waning.
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