Silver prices have shattered records in late December 2025, with the precious metal climbing to $77.92 per troy ounce on December 26—a stunning 165% gain compared to the same period last year. The rally marks another milestone in what analysts are calling the "sleeping beauty's" awakening after years of underperformance.
Supply Deficit Enters Eighth Consecutive Year
The surge is underpinned by a structural supply crisis that shows no signs of abating.
The global silver market faces a deficit of 206 million ounces in 2025, the eighth consecutive year of shortfalls between production and consumption. Mining output remains stagnant, with approximately 75-80% of silver coming as a byproduct of base metal operations, making supply highly inelastic to price increases.
Recycling efforts contribute only 150 million ounces annually, far short of bridging the widening gap between supply and demand.
India's Explosive Demand Reshapes Global Markets
India has emerged as a critical driver of the 2025 rally, with silver imports surging 300% year-over-year.
In October 2024 alone, India imported 60 million ounces compared to just 15 million ounces in October 2023—a fourfold increase. The nation's booming economy, expanding at 8.2% annually, has fueled both investment demand and industrial consumption across electronics manufacturing and renewable energy sectors.
The explosive growth in India's economy mirrors broader Asian market dynamics, reshaping global commodity flows.
Industrial Demand Surges on Green Energy Transition
Industrial applications now account for over 50% of global silver consumption, fundamentally altering market dynamics.
Solar photovoltaic installations alone consumed 232 million ounces in 2024—a 300% increase since 2015. The European Union's ambitious target of 700 gigawatts of solar capacity by 2030 will intensify silver requirements for crystalline silicon cells.
Electric vehicle production adds another demand pillar, with each EV requiring 67-79% more silver than internal combustion vehicles for battery management systems and charging infrastructure. Automotive silver demand is forecast to grow at a 3.4% compound annual rate through 2031.
The U.S. government's 2025 classification of silver as a critical mineral underscores its strategic importance to clean energy infrastructure.
Analysts Eye Triple-Digit Silver
Market strategists increasingly view $100 silver as achievable in 2026, given the persistent structural imbalances.
The metal's dual role as both an industrial commodity and safe-haven asset has intensified buying pressure across multiple investor categories. Silver futures have surged 113% in 2025, breaking past $60 for the first time in early December before extending gains through month-end.
Some analysts note that the gold-silver ratio remains elevated compared to historical averages, suggesting silver has room to outperform even if gold reaches $4,000 per ounce.
0 Comments