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Silver “Momentum Building” As “Supply Trouble Brewing”
Silver bullion prices are likely to rise further as there is “supply trouble brewing” as strong industrial and investment demand are confronted by declining supply.
“There are signs that this year could be a pivotal year for the silver market,” New York-based CPM Group said in its “Silver Yearbook 2016.”
“Silver mine supply is forecast to decline for the first time in 2016, since 2011,” CPM said, noting scheduled closures and planned production cutbacks.
More good news for silver bulls: there’s supply trouble brewing.
Output from mines will fall for the first time since 2011, while demand for the metal in uses including industrial products and jewelry is heading for a fourth straight gain, supporting prices, according to CPM Group. The market is entering what is “likely to be a pivotal year,” the New York-based researcher said in its “Silver Yearbook 2016” reported Bloomberg.
Bloomberg said that “momentum is building” as silver mine output is “seen falling for first time since 2011” at the same time that “investor holdings in silver ETFs rise at triple gold’s pace”.
CPM forecast global silver mine production will fall 2.4 percent to 784.8 million ounces in 2016, with output declining in Mexico and Australia but rising in Peru and China. Fabrication demand was seen rising 1.6 percent from 2015 to 889.7 million ounces, with increases in jewelry, silverware, electronic, battery and solar panel manufacturing.
CPM forecast a global deficit of 44.7 million ounces in 2016, much larger than the 11.9-million-ounce deficit in 2015 and the biggest deficit since 2005.
CPM expect demand for silver coins to fall to 142.8 million ounces this year, down from record levels of 145.7 million ounces in 2015. Silver coin demand in China, however, was forecast to rise to 24.5 million ounces from 22.3 million ounces in 2015.
Silver had its biggest quarterly rise in nearly 30 years in the first three months of 2016 as ETF investors, buying of silver coins (now VAT free in UK and EU) and bars and speculators in the futures market pushed prices higher.
Silver prices fell to $13.60 an ounce in December, the lowest in more than six years. Silver has since rallied nearly 20 percent in the first three weeks of April to an 11-month high at $17.70 an ounce and has entered a new bull market.
Recent Market Updates
Cyber Fraud At SWIFT – $81 Million Stolen From Central Bank
Gold In London Vaults Beneath Bank of England Worth $248 Billion – BBC
Silver Prices Up 6% This Week and 25% YTD; Gold Up 1% This Week
Gold Price Set To Push Higher As Inflation Picks Up – RBC
Silver Bullion “Has So Much More to Give” – 5 Must See Charts Show
China Gold Bullion Yuan Trading To Boost Power In Gold and FX Markets
Gold News and Commentary
“We believe the recovery in the U.S. is more fragile than is acknowledged” (GoldCore in Marketwatch)
Silver Supply Trouble Shows Why Rally Momentum Is Building (Bloomberg)
China’s gold imports from Hong Kong rise to 3-month high – (Reuters via Biz Recorder)
China’s Gold Imports Jump on Investment Demand as Price Falters (Bloomberg)
Silver may touch as high as $20 an ounce in near term – Deutsche Bank (Metal.com)
Gold Has “Chart of Decade” – Going to $10,000/oz – Rickards (Boomberg)
Depression, Debasement, & 100 Years Of Monetary Mismanagement (Zero Hedge)
Pimco Economist Has A Stunning Proposal To Save The Economy: The Fed Should Buy Gold (Zero Hedge)
Why a Collapse Is “Practically Unavoidable” (Casey Research)
Do Old Indicators Matter Or Is Physical About To Overrun Paper? (Dollar Collapse)
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Gold Prices (LBMA)
27 April: USD 1,244.75, EUR 1,100.79 and GBP 853.58 per ounce
26 April: USD 1,234.50, EUR 1,093.46 and GBP 847.28 per ounce
25 April: USD 1,230.85, EUR 1,094.08 and GBP 853.79 per ounce
22 April: USD 1,245.40, EUR 1,104.34 and GBP 868.73 per ounce
21 April: USD 1,257.65, EUR 1,113.21 and GBP 877.01 per ounce
Silver Prices (LBMA)
27 April: USD 17.34, EUR 15.34 and GBP 11.87 per ounce
26 April: USD 16.95, EUR 15.02 and GBP 11.64 per ounce
25 April: USD 16.86, EUR 14.98 and GBP 11.67 per ounce
22 April: USD 17.19, EUR 15.26 and GBP 11.96 per ounce
21 April: USD 17.32, EUR 15.31 and GBP 12.05 per ounce
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