Silver's supply-demand balance is the tightest in a decade. Mine production in 2024 was 820Moz, barely above 2016 levels. Most silver is produced as a byproduct of copper, lead, and zinc mining, which means primary silver mine investment has been insufficient to grow output.
Recycling reached 194Moz in 2024, a 12-year high, driven by higher prices and improved scrap recovery from industrial applications. But even at this elevated level, recycling covers less than 20% of total demand.
Total demand of ~1.16 billion ounces in 2024 exceeded total supply of ~1,014-1,016Moz by ~150Moz. The deficit is being filled from above-ground inventories, which are drawing down rapidly. The Silver Institute warns that at current consumption rates, visible inventories could be depleted within 3-5 years.
Projected 2025 output of 835-844Moz still represents only modest growth from 2016 peaks. Without significant new mine investment — which takes 7-10 years from discovery to production — the deficit is structurally locked in.
The structural silver deficit is getting worse, not better. Industrial buyers should treat silver as a tightening market. Consider longer-term contracts with integrated suppliers and explore silver leasing programs to secure supply without spot price exposure.