Silver Prices in Terms of Supply and Demand

Cassie Bastien

5/15/2017 1:03:01 PM

Daily Gold & Silver Market Report – 05/15/2017

London-based writer and Sharps Pixley commentator Lawrence Williams said although the fall of global Silver production was “a minimal 0.6 percent, global Silver demand in 2016 was estimated to have exceeded supply by a rather larger 147.5 million ounces - a seemingly ever-continuing global deficit in Silver supply vs demand.” Williams added, “demand will likely be unchanged, or perhaps higher still with growth in the photovoltaic sector in particular.” Nonetheless, real supply/demand figures having much impact on Silver prices in the short term is contentious. “In terms of a long-term trend, assuming these are continuing signs of future continuing, and perhaps growing, shortfalls in supply, fundamentals are likely to assert themselves as time progresses,” Williams said. “The most important part of global Silver output is as a byproduct from Gold and base metals mining and declining production in both sectors will likely lead to a further downturn in global Silver production this year and most likely the future. ... Some of the biggest mines in this sector have reached/or are reaching the ends of their productive lives.” Additionally, low metal prices in the last few years have led to declining mineral exploration in Gold and base metal sectors, which will also affect future supply levels. Williams closes saying, “Whether the Silver price will respond much in the short term to the likelihood of anther output decline this year is, however, a contentious point. Much depends on investment demand, which is volatile to say the least.”

Gold Prices Strengthen Due to North Korea Concerns

According to Vijaykumar Vedala with Reuters, “Gold prices edged higher Monday as weaker-than-expected economic data from the U.S. and a missile test by North Korea over the weekend pressured the dollar.” North Korea announced it successfully tested a new mid-to-long range missile on Sunday, “supervised by leader Kim Jong Un and aimed at verifying the capability to carry a “large scale heavy nuclear warhead,’” Vedala said. However, ANZ analyst Daniel Hynes said , “It (North Korea's missile test) is underpinning support for Gold but at the moment it’s obviously not escalated to the point where investors are becoming overly worried about.” Hynes also said with President Donald Trump thrown in the mix of things, “investors are a bit more cautious about the outcome than they have been in the past.”

President Trump's Uproar of Firing Comey Intensifies

The presidential administration is still dealing with the consequences of President Trump’s decision to fire FBI Director James Comey last Tuesday. Stephen Collinson with CNN.com said “Comey's dismissal during his investigation into Trump's campaign over alleged links to Russian election meddling took the sense of political dislocation in the capital to new extremes.” The White House's current distress is a direct result of President Trump's own doings and, as of right now, he is showing zero sign of changing his ways. Trump said at a commencement address Saturday, “The more that a broken system tells you that you're wrong, the more certain you should be that you must keep pushing ahead, you must keep pushing forward.” To add to the crisis surrounding Washington, Trump added there may in fact be “tapes” of his conversations with Comey.

At 2:03 p.m. (ET), the APMEX Precious Metals spot prices were:

• Gold, $1,232.20 Up $2.00
• Silver, $16.72 Up $0.22
• Platinum, $931.10 Up $11.60
• Palladium, $801.50 Down $7.00

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