According to the US Geological Survey (USGS), global silver production totaled 26,800 metric tons in 2016. Fully 80% of the world’s silver was produced by only nine countries: Mexico, Peru, China, Chile, Australia, Poland, Russia, Bolivia, and the United States.
As expected, Central and South America dominate the list. The vast Mexican and Peruvian silver deposits played a large part in fueling the ascension of Spain as a European superpower in the 15th and 16th centuries. In the 21st century, the two countries are still the largest producers in the global silver mining space.
At #9, silver production in the United States comes in far lower than its history of the legendary Comstock Lode in Nevada and the silver fields of Idaho would lead you to believe.
Missing from the list completely are traditional silver producing countries such as Canada and Argentina. Silver production in these nations has fallen off dramatically from historical peaks. On the other side of the equation, the appearance of China and Poland among the world’s top silver producers may come as a surprise to many.
As the global solar power market continues to accelerate, these vast solar farms that are being installed will place greater demand on silver production. Unlike gold, roughly half of all silver demand each year is consumed by industrial uses. Since new silver supply continues to lag behind demand for another year, scrap recycling and drawdowns of existing stocks will have to increase to make up the shortfall.
The downturn in copper and zinc prices last year idled many mines. These mines produce silver as a secondary resource, since it usually appears around the copper veins. Less copper being mined equals less silver being mined, exacerbating the silver shortfall.
The opinions and forecasts herein are provided solely for informational purposes, and should not be used or construed as an offer, solicitation, or recommendation to buy or sell any product.