The “white metal” is enjoying its moment in the sun on the world stage. Silver was last up 0.2% to US99 on Friday. 10 an ounce, closing to within cents of the landmark US100 level. That is a new record for the metal, which has surged 147% over just the past year. So the global elite rush to find a safe place to stash their cash, as they inevitably do in uncertain times, investors have naturally turned to silver, which has outperformed gold for months now.
The move into silver is coming amid a “perfect storm” of strong demand and weak supply. For the past four years in a row, the world has taken more silver out of the ground than miners have been able to dig up. This has pushed big buyers to tap their rainy-day supply stockpiles, which are starting to deplete. The upshot, the precious metal’s price has soared and few firms on the Australian stock exchange that mine silver are having their share prices soaring as high as they are at extreme elevations once thought impossible.
The Unseen Hand: Solar Panels and Green Tech
For all that people associate silver with shiny objects, jewelry or coins made of the metal, its true power today is in green technology. Silver is the most conductive element on earth, making it absolutely indispensable in the “energy transition.” Each solar panel you can see on a roof has about 111 milligrams of silver in it to enable the sunlight to be turned into electricity. Without this metal, solar power would be much less effective, and expensive.
In addition to solar power, silver is an essential component of the technology we rely on to get through our daily lives. It is found in the circuitry of smartphones, in data centres that drive the internet, and as an essential ingredient in the newest safety systems for cars. In a world that is constructing millions of new electric vehicles, and gigantic AI computer centres, the demand for silver just keeps growing. This industrial demand gives silver a “double boost”, it’s both a haven like gold and an essential ingredient for modern life.
Australian Miners Reap the Rewards
Among those to have received good news is South32, one of the Australian market’s largest silver producers. The company owns the North-West Queensland Cannington mine, one of the world’s largest and lowest-cost silver mines. With the price of silver fast approaching US$100, South32 shares reached a three-year high. With shares of silver miners soaring, investors are wagering that the company will reap a windfall of profits as they sell their silver into a market ravenous for every ounce.
Other precious metals are taking their cues from silver. Gold has reached its own record, approaching almost US$5,000 an ounce and platinum is up a whopping 171% in the past year. But it is silver that really steals the “show” with its remarkable pairing of beauty and function. In the meantime, all eyes are on whether or not silver will punch through to US$100 and above, a breakout that would set a new stage for the global mining sector.
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