The Silver Institute, in its annual World Silver Survey produced by Metals Focus, projects a 46.3 million ounce deficit in 2026, widening from 40.3 Moz in 2025. Other estimates, including Reuters-cited projections, put the deficit as high as 67 Moz. This marks the sixth consecutive year the market has consumed more silver than it produces.
On the supply side, global mined silver production is forecast to dip 0.3% to 844.1 Moz. Approximately 70% of silver comes as a by-product of base metal mining, meaning even record silver prices have not driven meaningful mine supply growth. Refinery bottlenecks remain a structural cap on scrap processing.
The most significant policy development is China's export licensing system for refined silver, effective January 1, 2026. China mines approximately 13% of global silver but refines 60-70% of the world's traded silver. The new controls require exporters to obtain licenses from MOFCOM, effectively prioritizing domestic users. Only 44 companies were approved for 2026-2027 exports.
COMEX registered inventories have fallen more than 75% from 2020 highs to approximately 80 million ounces. Multiple analysts classify current inventory levels as stress territory. The gold-silver ratio has compressed from 85:1 to approximately 65:1.
The structural deficit is the single most important factor for silver buyers. Physical premiums remain elevated despite the price correction. China's export controls mean supply chains are being reshaped — buyers who rely on Chinese-refined silver need to identify alternative sources. The deficit environment supports the view that pullbacks toward $60 are buying opportunities, not structural breakdowns. Consider building inventory during the current correction.