Since the beginning of 2025, the price of silver has shown a more significant increase than the price of gold and the S&P-500 index. Nevertheless, the market will remain deficient for the fifth year in a row by the end of the year, according to a study by The Silver Institute & Metals Focus.
This year has been dramatic for silver: galloping prices, record shipments to the Chicago Mercantile Exchange (CME) due to concerns about Trump's tariffs, unprecedented shortages and its official recognition by the US government as a critically important mineral.
In addition, increased macroeconomic and geopolitical risks, including the US tariff policy, have prompted investors to increase investments in precious metals to diversify their portfolios.
As a result, investment demand increased, which offset the decline in demand for silver in other areas of its consumption and application.
In terms of fundamental market factors, the global supply of silver in 2025 is expected to grow by 1% to 1,022 million ounces (31.8 thousand tons), which will be facilitated by a moderate return of producers to hedging.
At the same time, production will remain approximately at the level of the previous year — 813 million ounces. The increase in production in Mexico and Russia (+4.5 million ounces) will be offset by decreases in Peru (-5.1 million ounces) and Indonesia (-5.7 million ounces).
Production in Mexico will increase by 5 million ounces to 186 million ounces due to the reopening of the Tizapa mine after a prolonged strike, as well as capacity expansion at Endeavour Silver's Terronera mine and increased production at the Southern Copper mine.
Recycling volumes will grow by only 1% this year, but still reach a 13-year high, mainly due to the volume of silverware recycling, especially in Western markets, which compensates for somewhat restrained supplies of industrial scrap.
According to experts, global demand for silver will fall by 4% to 1.12 billion ounces (34.8 thousand tons). A decrease is expected in all key segments of silver demand, primarily in industrial and jewelry production, as well as bullion and coins.
In particular, industrial consumption will decrease by 2%. This is due to the impact of global economic uncertainty caused by the US tariff policy and geopolitical tensions, as well as widespread austerity due to the sharp rise in silver prices.
A new record is expected in the production of photovoltaic systems. However, due to the drastic reduction in the amount of silver used in each module, its usage is projected to decrease by about 5%. This will be partially offset by significant growth in the AI market for data centers.
