Forecasting higher demand, The Silver Institute, a trade association, says the outlook for silver in 2021 is “bright.”
“The outlook for the silver price in 2021 remains exceptionally encouraging, with the annual average price projected to rise by 46 percent to a seven-year high of $30.00,” according to the Institute’s just released analysis.
Silver’s average price in 2019 was 16.19 in 2019. Last year saw a 27 percent increase, with an average annual price of $20.52. For 2021, the Institute expects an average annual price of $30.00. That represents a 46 percent increase over 2020.
The report is calling for 2021’s silver demand to reach an eight-year high of 1.025 billion ounces, led by increasing industrial and physical investment demand. “Industrial demand is projected to post a four-year high in 2021 of 510 million ounces, a 9 percent increase over 2020 figures,” according to the report.
Physical silver for investment, coins, and bars, is forecast to reach 257 million ounces, a six-year high.
The photovoltaic sector bounced back from the pandemic slowdown in the second half of 2020 and is forecast to reach 105 million ounces in 2021.
The Silver Institute also expects some recovery in global jewelry demand. The 174-million-ounce forecast is still below pre-COVID-19 levels
“Silver mine production output should recover and rise from the pandemic-affected 2020 level, achieving a double-digit gain this year to 866 million ounces, which would be the highest total since 2016. Most mines affected by COVID restrictions have re-started, with the recovery also benefiting from the re-opening of key mines affected by strike actions. Growth will also be driven by higher output from primary silver mines and by new projects in Mexico and Australia,” it reports.
“Silver scrap supply is expected to rise for the fifth consecutive year, due in part to the strength in gold and silver prices, which will encourage industrial recycling. Jewelry and silverware recycling are also forecast to rise this year.”
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