The price of silver has shown a 57-percent growth since early 2025, approaching its 1980 high of $52 per ounce in October and significantly outpacing the analysts’ forecasts. The LBMA’s consensus forecast for silver price of $32.86 per ounce was only 16% higher than the actual average price of $28.27 in 2024, despite the fact that silver was the leader among the four precious metals (gold, silver, platinum, and palladium). Heraeus Precious Metals forecast a price range between $28 and $40, also expecting silver to outperform gold in the pace of the price growth. This is currently the case, although the situation was different a year ago, with gold outperforming silver.
While a rapid rise in gold prices, and traditionally, the rise in silver prices in 2025 are largely driven by monetary and geopolitical factors, silver, unlike gold, boasts an excellent fundamental basis for its price growth. Since 2021, the silver market, where supply has outpaced demand for nearly 50 years, has been in deficit. A growing industrial demand, particularly in the renewable energy generation, the electronics and automobile manufacturing sectors, is facing mining constraints and insufficient recycling volumes. This imbalance does not appear temporary, as the combination of rising demand and limited supply lays the foundation for sustainable growth in the future.
Widening deficit
In its World Silver Survey 2025 report published in April for the Silver Institute, Metals Focus forecasts a continued silver deficit in 2025. This would make 2025 the fifth consecutive year of silver shortage. Although the deficit is less than half the record level of 250 mn ounces in 2022, it is still significant and makes 118 mn ounces, or 12% of global supply of silver. The cumulative silver supply deficit from 2021 to 2025 is expected to reach 796 mn ounces, nearly equal to an entire year of global silver mining output. From 2016 to 2021, the silver market was in surplus, but the cumulative excess supply over these five years was more modest, just 185 mn ounces.
Silver mining output and recycling production will grow very moderately, while strong demand for industrial use, primarily in solar energy generation, electronics manufacturing, and green technologies, will continue shaping the market.
According to Metal Focus, global demand for silver in 2025 is expected to reach 1.148 bn ounces. While this is down 1% compared to 2024 (a year ago, demand was 3% lower), demand for the metal remains high, significantly exceeding the levels of 2016 to 2021. Industrial demand for silver is expected to decline slightly, with the demand from jewelry industry falling by 6%, while the purchases of silver coins and bars will grow by 7%.
Silver industrial demand
The shift in the silver market emerged in 2021 is related to a shift in the structure of demand for this precious metal. Historically, investment demand was prevalent in silver pricing, while the industrial demand for silver, although gradually growing, played a secondary role. In 2015, the share of investment demand for silver was 35%, and it fell to 28% in 2024.
At the same time, industrial demand now accounts for 60% of silver consumption. This transformation has profound implications for silver pricing, as industrial consumers are generally less price-sensitive than investors.
In 2025, industrial demand for silver will decline by 0.5% to 677 mn ounces, but the absolute value will remain the second-highest ever. Metal Focus expects that the slowing growth in ethylene oxide production capacity, as well as the reduced use of silver in the solar energy generation sector will be offset by the continuing growth in the consumption of the metal in the automotive, power grid, and consumer electronics industries. A long time ago, these sectors replaced the traditional photography industry, which once dominated the industrial use of silver (accounting for 49% of the industrial demand for silver in 1983), where demand for the metal plummeted with the advent of digital technology.
Key growth areas for silver consumption for industrial applications:
- PV-generated electricity sector. The solar panel sector remains the largest driver of the soaring industrial demand for silver. Highly conductive, the metal is used in solar panels in the metallizing process: silver paste is deposited on a silicon wafer in the form of fine-gridded contacts, which - after heat treatment - collect and transmit the current generated.
- Next-generation electronics production: The expansion of 5G infrastructure and the development of AI-powered consumer electronics are also driving the growing demand for silver. Silver applications range widely in this sector, from smartphones and tablets to servers and telecommunication infrastructure.
- Automobile manufacturing. The growing complexity of vehicles, particularly electric vehicles (EVs) and advanced driver assistance systems (ADAS), is shaping the growth of the silver’s share in vehicle manufacturing.
In the sector of electrical parts and electronics, the consumption of silver is expected to be at 466 mn ounces, up 1% from last year. However, in the photovoltaic industry, which accounts for 29% of global demand for silver, the metal consumption will fall by 1% this year to 196 mn ounces. Silver consumption in this sector increased by 3% in the previous year.
Demand for silver and a Metal Focus’ forecast for 2025:
Solar panels
According to Philip Newman of Metals Focus, the slowdown in demand for silver from the solar PV system sector “may appear to be a little bit bearish, but from my point of view ... the biggest takeaway is that silver demand is holding basically at record high levels, even though it is not growing.”
Demand for silver in the PV industry surged from approximately 65 mn ounces in 2016 to over 160 mn ounces in 2023. Approximately 80,000 to 100,000 ounces of silver are required to generate a gigawatt of solar capacity.
According to the research company TrendForce, the average annual growth rate of solar PV capacity additions in the world from 2019 to 2023 was 42.3%. In 2024, the capacity addition was 563 GW, and a 596-GW capacity addition is expected in 2025.
Global annual solar PV capacity additions:
The pace of growth of this market has naturally begun to slow, especially since the industry has seen a decline in the average silver loading in solar panels this year due to high silver prices. Newman believes that silver exceeding $50 per ounce could push photovoltaic system manufacturers to further reduce silver loadings in their products.
Currently, silver costs account for approximately 11 to 13 percent of the cost of a solar module. However, manufacturers facing fierce competition cannot afford to raise prices for solar modules due to rising silver prices. This situation may help copper-based products emerge and create more favorable conditions for heterojunction (HJT) solar technologies, which rely less on silver.
Cost savings and substitution, which could easily accelerate with the growing price for silver, remain the main unknown factor in this sector, according to Metal Focus’ research. Even without the silver rally, technological advances paving the way for a wider use of composite powders (such as those using copper) will negatively impact the silver demand, primarily from photovoltaic system sector.
The photovoltaic market itself is also weaker than normal at present, largely because local subsidies were ended in China, explains Newman.
Silver loadings in solar panels are estimated to have declined by approximately 20% in 2024, and this downward trend continues. A further decline in solar panel production is expected this year, potentially exceeding 15%. “But that does not detract from the fact that demand is still outpacing supply,” says Newman. Although the global supply gap has narrowed since 2023, it remains significant, Newman notes.
Silver industrial demand outlook
Despite short-term pressure due to the escalating trade war, structural changes (often associated with decarbonization, such as the shift to electric vehicles and solar panels) should result in silver industrial demand growth exceeding the global GDP growth, according to the Metal Focus’ research. Additional support can also come from advanced achievements in artificial intelligence (AI) that will boost sales of new electronic devices, as well as from the continued construction of energy-intensive data centers.
The rapid growth of the drone market driven in part by geopolitical tensions, offers clear opportunities for higher demand for silver, notes Metal Focus. Drones that play a key role in modern warfare, require conductive silver paste used as an electromagnetic interference shielding.
Other areas already seeing steady growth in silver use include 5G data transmission equipment and the defense/aerospace industry, where silver is already widely used due to its ability to withstand harsh conditions. For example, in satellites, a silver coating on internal electronics reflects incident thermal radiation and simultaneously transfers and dissipates heat from the onboard equipment.
Automobile manufacturing
Due to its unrivaled electrical conductivity, silver is a key element in modern vehicles, whether they are traditional internal combustion engine (ICE) automobiles or state-of-the-art electric vehicles (EVs). Typically, silver is used in automobiles in brazing alloys and solders, as well as in conductive inks.
Demand for silver for use in the automobile manufacturing has increased dramatically in recent years, with global sales growing at a 40-percent average annual rate. While traditional vehicles contain approximately 15 to 28 grams of silver, electric vehicles use 25 to 50 grams of silver, due to a high silver content in high-voltage electrical systems. Advanced driver assistance systems and EV charging infrastructure facilities place additional requirements as to silver content. Radar, lidar, and camera-based sensors required for lane keeping, collision avoidance, and autonomous driving rely heavily on silver-based electronics enabling fast and precise operation.
In addition to its established use in rear window defoggers, conductive silver inks are increasingly used in antennas, temperature and glass break sensor wires, and heating systems (for steering wheels and seats). In some electric vehicles, conductive silver inks are used to preheat batteries in cold weather. These new growth opportunities highlight the significant potential for the use of silver in industry, according to Metal Focus’ research.
In 2024, the use of silver in the automobile manufacturing sector increased, in spite of a 2-percent decline in vehicle production. Nevertheless, advances in technology in this rapidly growing sector point to lower-than-expected silver consumption per EV, notes Metal Focus. However, this is still outweighed by expanding the functions (such as sensors) and the addition of new functions (such as heated seats in vehicles).
Annual silver consumption in the automotive industry currently is estimated at approximately 66 mn ounces, distributed among traditional internal combustion engine components, as well as electrical vehicles and advanced driver assistance systems.
Structure of silver demand in the automotive industry:
Investments
In 2024, silver exchange-traded products (ETPs) experienced a reversal after two years of outflows. Total assets increased by 6.3%, or 62 mn ounces, to 1.038 bn ounces by the end of 2024, offsetting most of the losses of the previous two years. In 2023, outflows amounted to 38 mn ounces, and to 117 mn ounces in 2022. Having peaked in November 2024 at 1.066 bn ounces, the trend reversed; however, outflows from North American exchange-traded products were partially offset by the growing Indian ETPs, with their assets nearly doubled in 2024 due to positive price expectations in the local market. India’s share of global ‘silver’ ETPs is currently estimated at just 4%, but given the prevailing view of silver’s undervaluation relative to gold, the ETPs’ convenience and liquidity, and rising financial awareness, Metal Focus expects India’s importance to grow.
Metal Focus estimates that silver ETPs will receive total inflows of 70 mn ounces in 2025, up 14% over the strong figure in 2024.
Silver bars and coins
Investments in silver coins and bars declined consistently in 2023 and 2024 after their peak of 338 mn ounces in 2022. Last year, demand decreased by 22% compared to 2023 to a five-year low of 191 mn ounces. The decline was observed in all key Western markets, primarily due to cost-of-living concerns and profit-taking at high prices for the metal. The sharpest drop was seen in the USA, down 46%. In contrast, demand for silver coins and bars surged by 21% last year in India, reaching its highest level since 2015. The ongoing strengthening of the rupee also curbed profit-taking, underpinning optimistic silver price expectations.
In 2025, Metal Focus expects the demand for silver coins and bars to recover after two years of decline and to grow by 7% to 204 mn ounces. A slight recovery is expected in Europe, particularly in Germany. In the USA, a significant increase in commemorative coin minting is expected, offsetting the ongoing decline in demand for silver bars and investment coins. In India, record-high domestic prices for silver could give a boost to profit-taking and outweigh new investments.
Demand from jewelry industry
According to Metals Focus’ research, silver use in the jewelry industry is expected to decline by 6% this year to 196 mn ounces, returning to 2017 levels. This slump in demand is primarily explained by negative consumer sentiments due to high silver prices, particularly in India, where the restocking by retailers will be constrained by record-high local prices. Demand for jewelry remains sluggish in China amid household spending cutbacks, although branded silver jewelry will remain in demand. Western markets will be largely stable, with the demand volumes in the USA and Europe remaining virtually unchanged. A significant 15-percent decline in demand for silverware is possible, primarily due to the demand from India amid high prices.
Supply
According to Metal Focus, global silver supply will grow by 2% in 2025 to 1.031 bn ounces. Silver mine production will increase by 2% to 835 mn ounces, while secondary production will decrease by 0.4% to 193 mn ounces.
Silver Production:
Most of the silver production growth will be driven by Mexico, where MAG Silver’s Fresnillo and Juanicipio mines are expected to peak, the Peñoles’ mines will return to full production after operational challenges in 2024, and Endeavour Silver’s Terronera project will be put into operation. In Chile, Kinross’s Codelco and La Coipa mines will fully recover their mining, and Gold Fields’ Salares Norte mine will continue expanding to increase its production by 3.5 mn ounces to 46.6 mn ounces.
In Russia, silver production is expected to grow by 3.1 mn ounces due to the start of ore deliveries from Polymetal International’s Prognoz deposit to the Nezhdaninskoye one and the full ramp-up of MBC Corporation’s Ozernoye deposit. Silver production declines in Australia (by 5.4 mn ounces) and Peru (by 5.1 mn ounces) will partially offset this increase. In China, silver production is forecast to be virtually unchanged year-on-year and is estimated at 110.4 mn ounces.
Silver recycling volumes will remain virtually flat in 2025, according to Metal Focus. Depletion of high-quality materials such as jewelry items and silverware will put pressure on supply in some markets, but rising prices in India mean these sectors should see modest growth globally.
Beyond the general challenges facing the mining industry, silver supplies are constrained by the fact that only 27 to 30 percent of the global silver production comes from primary silver mines. Silver is primarily mined as a by-product when extracting other metals at lead-zinc (36%), copper (23%), and gold (12%) mines. Its ‘by-product’ profile means that the decisions on silver production often depend on the economics of base metals or gold, which limits the market’s ability to respond directly to silver price signals.
Sergey Bondarenko for Rough&Polished
