The Silver Institute published its mid-year update this week, cutting 2026 industrial demand growth from 6% to 3.2%. The downward revision is concentrated in electronics and silver paste for photovoltaic cells. Solar panel demand, which had been the fastest-growing segment, saw its growth projection cut from 12% to 8% as Chinese solar installations moderate.
The demand picture is diverging sharply between sectors. Jewelry and silverware demand remains stable, supported by lower silver prices drawing buying from India. Indian silver imports in May reached 540 tonnes, up 24% year-over-year, as local jewelers stocked up on the dip.
On the supply side, global mine production is expected to rise just 0.5% to 835 Moz in 2026. Primary silver mines are adding modest capacity, but the majority of silver production is as a byproduct of copper, lead, and zinc mining. Those operations are not responding to silver prices. The Silver Institute still projects a structural deficit of 145 Moz for 2026, though reduced from the earlier forecast of 180 Moz.
Exchange inventories provide some buffer. COMEX silver stocks at 8,720 tonnes are down 8% year-to-date but remain near historical averages. Shanghai Futures Exchange stocks have been building, reaching 2,100 tonnes in mid-June.
The demand downgrade is real but the silver market still faces a structural deficit. Buyers should use the current weakness to negotiate fixed-price contracts for H2 2026 deliveries. The $55-$60 range offers attractive entry points, especially with the deficit expected to tighten when manufacturing recovers cyclically in Q4.