Silver Prices Could Soar Silver prices are significantly undervalued if you look at the demand-and-supply situation in the gray precious metal market. Don’t rule out silver prices of $50.00 per ounce just yet.
The supply side seems to be struggling, and the demand for the gray precious metal remains solid. Economics 101 suggests that this disparity in the most basic economic factors is a perfect recipe for much higher prices.
To assess the supply side of the silver market, just pay attention to the major silver-producing regions. We are seeing a significant amount of struggle.
Look at the silver sales at the mints around the world to get some idea for demand. For instance, take the U.S. Mint. Year-to-date, the mint has sold 37.411 million ounces of silver in American Eagle coins. The mint is on track to report lower sales in 2016 than in 2015, but the sales level remains elevated. (Source: “Bullion Sales,” United States Mint, last accessed November 29, 2016.)
Pay attention to India as well. The country known for its appetite for gold could turn out to be a major buyer for silver as well. We are seeing an immense amount of silver being imported into the country. In October alone, $181.93 million worth of silver was imported into the country. (Source: “Quick Estimates For Selected Major Commodities For October 2016,” Government of India Ministry of Commerce and Industry: Department of Commerce, last accessed November 29, 2016.)
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