Each year, silver mines produce about 650 million ounces of silver. Around 200 million ounces come from recycling and about 100 million ounces come from investor or government sales.
That's a total of about 1000 million ounces. Of that, about 42 per cent is consumed for industrial use, about 28 per cent for making jewellery, about 20 per cent by the photography industry and around 5 per cent is consumed in manufacturing coins and medallions. That's 95 per cent of the total silver available each year.
This implies either a 'surplus', or 'investment demand', of about 5 per cent. At $20/oz., that's only $1 billion per year of net investment demand.
Since the 1950s, silver use and consumption, has made silver more rare than gold, in above ground, refined and deliverable forms.
Estimates suggest there are 200-300 million ounces of refined, above ground silver available to the market at the present time. There are about 125 million ounces of silver at the NYMEX, the big commodity exchange in New York. The ETF SLV has about 180 million ounces.
Image: A Dragonfly hair ornament (L) is seen alongside a brooch at the 'Bejewelled by Tiffany' exhibition at Somerset House in London, 07 July 2006. The piece dates from around 1890-1900 and is made of gold, silver, diamonds, and sapphires | Photograph: John D Mchugh/AFP/Getty Images
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