About the Silver Market Outlook

Silver’s rally continues to shine bright as the metal faces a rare combination of tightening supply and booming industrial demand. With mining output declining and demand from renewable energy and electric vehicle sectors rising rapidly, experts anticipate the silver market to remain in deficit through 2025.

According to global data from The Silver Institute, annual mining of silver has dropped from 900 million ounces in 2016 to an estimated 835 million ounces by 2025. Despite recycling efforts, total supply, including recycled silver, has remained nearly flat between 975–1,025 million ounces since 2017.

Shrinking Supply and Rising Prices

New mines are not expected to ease the pressure anytime soon, as exploring and developing a new silver mine can take up to a decade. This has led to a steady decline in fresh production and a concurrent rise in prices. Recently, silver crossed the $50 per ounce mark — its highest level ever — after rising 61% over the past year, according to Bloomberg Spot Prices.

The limited growth in production is due to the long cycle required for mines to progress from exploration to commercial output, typically spanning 8–15 years. This slow pace means that global production growth will likely stay restrained at just 2–4% annually.

Soaring Demand from Solar and EV Sectors

Silver’s industrial appeal has expanded dramatically in recent years. The metal is a critical component in solar photovoltaic cells and electric vehicles — two sectors witnessing exponential growth. Demand for silver in clean energy applications has made it an increasingly attractive option for investors looking beyond traditional gold investments.

Srinivas Kotamarthi, CEO of eBullion, noted that investor awareness and retail participation have surged in the last two years, with buyers entering the market at even small ticket sizes such as ₹1,000 in silver bullion. The broader demand for silver has outpaced supply every year since 2021.

Projected Deficit and Investment Implications

In 2024, global silver demand exceeded supply by nearly 149 million ounces. By 2025, this gap is projected to persist at around 118 million ounces. Even accounting for recycling and new mine projects, the expected incremental production of 20–40 million ounces will remain far below the projected shortfall. This persistent deficit reinforces the bullish sentiment around silver’s medium-term outlook.

For investors, this means silver may remain a preferred hedge against inflation and a proxy for industrial recovery. Its dual role as both a precious and industrial metal ensures long-term demand resilience, making it a key element of diversified portfolios.

Investor Takeaway

Indian-Share-Tips.com’s Main Technical Analyst Gulshan Khera, CFP®, who is also a SEBI Registered Investment Adviser, observes that silver’s current deficit-driven rally is not just speculative — it reflects deep industrial integration and constrained supply pipelines. He highlights that the next few quarters could see continued investor interest in silver as long as renewable and EV demand remains strong.