World Silver Association: Global Silver Market to Face Sixth Consecutive Year of Supply Shortage

According to Odaily, the World Silver Association maintained its previous view in its annual outlook released on Wednesday, stating that the global silver market will face a supply shortage for the sixth consecutive year. The report indicates that the supply deficit in 2026 is expected to widen by 15% to 46.3 million troy ounces. Despite an 18% increase in demand for silver bars and coins, total consumption may decline by 2% due to decreased demand in industrial, photographic, jewelry, and silverware sectors. Supply is projected to fall by 2%, primarily due to a slight drop in mine production and reduced hedging, though this is partially offset by a 7% increase in recycling. The report states that while the war in Iran casts a shadow over the short-term price outlook, it maintains a "constructive view" on silver for the remainder of 2026.

The association expects the Middle East conflict to remain contained, and monetary policy tightening aimed at curbing energy inflation will be temporary. Even if the war persists, concerns over weak growth and fiscal strain may lower real bond yields, thereby boosting non-yielding precious metals like silver and gold. The report writes: "Combined with a recovery in safe-haven demand amid cyclical market liquidations, this should reignite interest in gold and silver." (Jin10)