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Wednesday, July 29, 2015
Silver Institute highlights higher Silver demand in 2015 but not necessarily Higher Prices
Today is Wednesday 29th July 2015 and we are going to discuss briefly the Silver Institute’s 2015 First Half Report Press Release which was issued yesterday.
Now for the sake of clarity and so that we cannot be accused of misrepresenting the Report, we attach a link to it below this video.
OK The Silver Institute headlines: “Upticks in Silver Demand Seen in First Half of 2015”. In summary it states the following:
• US imports of silver jewellery jumped 11% from January to May 2015 in dollar terms
• Thailand imports were up 18.5%
• China imports up 14%
• GFMS the precious metals consultancy, estimates that global silver jewellery demand will grow 5% in 2015
• GFMS also predicts that Industrial applications will increase their demand for silver by 2%
• Solar panel producers are expected to increase demand by 8%
• Demand from ethylene oxide producers is forecast to increase by 61%
• Electronics demand expected to rise by 0.4%
• An expected 4.5% decline in demand by computer and tablet producers.
• Increase in demand envisaged by mobile phone shipments by 3%
• ETF Holdings increased this half year by 4.7 million ounces
• Bullion Coin sales fell by 6% compared to last year.
So the conclusion of the Silver Institute, now remember this is a forecast – is that there will be a deficit of 57.7 million ounces of silver in 2015.
Let’s just bear some points in mind;
• Firstly the Silver Institute is more likely to be bullish bearing in mind its membership, though on the side of balance we do rate highly their findings and views.
• Secondly, there are assumptions made on the supply side which are close to mining historic growth patterns of 3%. We believe because of the pressure on prices, miners will produce more to balance out cashflow, but we could of course be wrong
• Thirdly and more importantly, it is assessed, even by the silver bulls, that there is between 1billion and 2 billion ounces of above ground silver available to the market place. So even if we were to take the lower figure of 1 billion ounces, to use up that amount of available supply with a 57.7 million deficit, 17 years will have to pass.
Ah but we hear the critics say, “Physical demand for coins and bars will increase this deficit further,” and do you know, they may be right. So let’s add another 100 million ounces to the deficit equation, which will then push physical demand for investment higher than it’s ever been before. Even then, in a worst case scenario, a minimum of 6 years above ground silver supply exists, and you can bet if prices have started to move up by then, then so mine production will also increase.
Back to the world of reality, however, the Silver Institute says and we quote: “In the first half of the year, global bullion coin sales totalled 43.6 million ounces, 6 percent below levels seen in the same period a year ago.” Australia’s Perth Mint saw its silver coins sales spike in June due to a more attractive silver price, though sales overall are down 18% from the same period in 2014.”
So we ask you to draw your own conclusions, a bullish report YES. On track for a major rise in the Silver price? Well in the words of the famous Francis Urquhart in House of Cards : "You might very well think that; I couldn't possibly comment"
MAKE SURE YOU GET PHYSICAL SILVER IN YOUR OWN POSSESSION. Don't Buy SLV, or Futures or Pooled Accounts or any other BS paper silver product .Remember anything on paper is worth the paper it is written on. Go Long Stay long the bull market have even started yet
Posted by Gordon Silverstein