The silver market is forecast to record another significant deficit (total supply less demand) for the fifth consecutive year in 2025. In keeping with previous years, silver industrial demand will remain the key driver of this favorable supply/demand backdrop, with volumes projected to hit a new record high this year.
Concerns about President Donald Trump’s anticipated tariff policies have fueled short covering and deliveries of silver (and other precious metals) into CME warehouses since late 2024. This, coupled with rising economic and geopolitical uncertainties, has underpinned a healthy recovery in silver prices since the start of 2025.
Over the same time, silver investment has faced several challenges. For example, ongoing concerns about the prospects for the Chinese economy have weighed on silver, which helps explain the elevated gold:silver ratio that has persisted.
With this in mind, the Silver Institute offers its thoughts on the 2025 silver market, noting that Metals Focus, the prominent global precious metals research consultancy based in London, contributed to this analysis. The firm will research and produce the Silver Institute’s annual report on the international silver market, World Silver Survey 2025, which will be released on April 16.
Silver Demand
Global silver demand is expected to remain broadly stable in 2025 at 1.20 billion ounces, as gains in industrial applications and retail investment will be mitigated by weaker jewelry and silverware demand.
Silver industrial fabrication is forecast to grow by 3 percent this year, with volumes on track to surpass 700 million ounces (Moz) for the first time. In keeping with recent years, silver will benefit from ongoing structural gains in green economy applications. Despite looming pressure on US renewable energy projects under President Trump’s second term, global photovoltaics installations are expected to achieve another all-time high in 2025, benefiting silver demand. In the automotive industry, even assuming slower growth in battery electrical vehicle production, greater vehicle sophistication, electrification of powertrains (albeit at a reduced pace), and ongoing investment in expanding related infrastructure will boost silver demand.
Elsewhere, gains are also expected in the consumer electronics market, as the development of artificial intelligence systems will continue to boost product offerings. Demand for silver in the “other” industrial category should edge higher due mainly to some upside in the ethylene oxide (EO) sector. At the same time, modest gains are also projected for brazing alloys.
Silver physical investment is also forecast to rise by 3 percent, thanks to improving demand in Europe and North America. As Western investors adjust to new price levels, fresh investment is expected to improve, and profit-taking will also ease. However, without any dramatic crisis events, the scale of recovery will be limited, considering robust demand over 2020-23 and the subsequent rise in investors’ silver holdings. A slight decline in India, where high local silver prices will encourage liquidations, will offset some of these gains.
The demand for jewelry is expected to decline by 6 percent. India will account for the bulk of these losses, with high local prices the key driver behind a double-digit decline in 2025. Due to cautious spending by consumers on non-essential items, Chinese demand will also weaken. By contrast, Western jewelry sales will likely remain resilient, thanks to a price-led shift away from carat gold jewelry. Branded silver jewelry is also expected to perform well, offering additional support.
Similarly, for silverware, a price-led decline in Indian fabrication will result in global silverware demand falling by 16 percent in 2025.
Silver Supply
Total global silver supply is forecast to grow by 3 percent in 2025 to an 11-year high of 1.05 billion ounces.
Silver mine production is expected to reach a seven-year high in 2025, rising by 2 percent to 844 Moz. Increased output is anticipated from both existing and new operations in several markets. In China, growth will come from base metal and gold operations, while in Canada and Chile, the ongoing ramp-up of Hecla’s Keno Hill and Gold Fields’ Salares Norte will contribute to rising output, respectively. In Morocco, the ramp-up of Aya Gold and Silver’s Zgounder expansion to nameplate capacity will significantly add to production.
By-product silver from gold mines is expected to rise in 2025. In contrast, output from base metal mines will likely remain flat year-on-year. Base metal prices remain suppressed compared to the highs of 2021, and this poses a risk to production from lead-zinc mines.
Silver recycling is projected to increase by 5 percent, with volumes breaching 200 Moz for the first time since 2012. This year, industrial scrap will be the key growth driver, particularly changeouts in ethylene oxide catalysts. Jewelry and silverware recycling will also rise, reflecting India’s price-led gains.
The silver market is forecast to remain in a deficit in 2025 for the fifth year running. Although this year’s deficit is expected to fall by 19% to 149 Moz, it is still sizeable historically.
Silver Investment
Despite headwinds from a firmer dollar and Treasury yields, investor sentiment has improved towards silver during early 2025. This largely reflects several macroeconomic and geopolitical risks, which have continued to underpin inflows into safe-haven assets, such as silver and gold. The recovery has been assisted by short covering by tactical investors in the futures market amid fears about President Trump’s tariff plans and a subsequent spike in futures and spot silver prices.
Looking ahead, uncertainty over US trade and foreign policy, record-high US equities, and worries about US public debt levels should all reinforce interest in portfolio diversification, which in turn will benefit silver and gold investment. Moreover, even if the pace of US policy rate cuts slows in 2025, the consensus is still that they are coming. Coupled with sticky inflation, this points to potential declines in real rates ahead.
However, potential tariff hikes under Trump’s administration and their impact on global economic growth, particularly in China, will likely restrain investor enthusiasm across the broader industrial metals complex. This could remain the key drag on silver investment in the coming months, even though silver’s actual industrial demand is expected to remain robust.
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