Silver’s Shrinking Supply

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Have you ever inside those “buy gold for cash” outfits? I decided one years ago, back in my days as a reporter.

It was one of the most unusual sights that you have ever encountered. It was a large industrial plant (which later went into bankruptcy): dozens of people sit at long tables to open the sorting and packing. Cut a flap on one and extracted the gold fillings out slaps. From another gold necklace. While in the third bag, and someone sent in a gold watch his grandfather.

Silver also has a number of large recycled sources. The remnants of industrial applications account for the lion’s share, together with old silver and refining of jewelry.

These days, there’s only one problem (and gives you the opportunity, if no one wants to imagine a precious metal investor like me) to part with their “old gold” and the family silver.

Who would the Spot market price is for gold and silver right now?

The World Gold Council in its latest report on the topic, said the volume of refined gold on the market in the past year declined in the third quarter to 252 thousand tonnes by 6% in 2014, in several stages.

Low and is Constantly decreasing

This is the latest in a long series of drops, following the supply of scrap gold in recent years, and part of the cycle, the price of lots of precious metals. According to the World Gold Council, 1999 (with market prices in the service a change of generations in the low $250s per ounce) of processed gold, only 17% of the total supply. It reached 42% in 2009, the gold to climb to $900. Of course, in 2009, he seemed to almost each emptying of the box from unwanted jewelry and unwanted relics.

Since the third quarter of last year, we are down at 25% increase and is expected to decline further in the coming quarters.

Silver will continue as well. The peak of silver prices in 2011, almost 50 dollars per ounce encourages people around the world to cash in the recording of 206 tonnes of recycled silver metals after areas of research and the office of the Silver Institute.

Faster in large quantities in industry (estimated at 91 tons) forward to 2015, and the only category where silver will continue recycled. As for the rest, it is largely across the Board (and likely even lower to be in 2017).

Old Cutlery? Tonnage is down 43%. Silver photo negative? Off 30% (and in terminal decline already due to digital technology), along with about a third less processing silver jewelry. Even the old main pillar coin shops are everywhere – melting souvenir-a silver dollar-and somehow less popular. Only 6 tons, about 19% less than in 2011, entered the market last year.

I don’t need to say what this means in relation to the supply of, demand for and future price of gold and silver. But I’m going to add a second, which is often overlooked factor about the silver market…

Copper, Zinc And Silver

More than half of the world’s “new” silver is not recycling material, but ore out of the ground every year – not an honest-to-goodness silver mined in the result of the operation. Instead, it is a byproduct of a miner digging for other minerals such as copper and zinc.

Now in which particularly the metals markets think happened, they all went down in price like silver and gold.

And what happens as a result of this reduced seemingly eternal price? Mining companies are reluctant to mine down to go after me. As a result, offered global copper is still in surplus predicted for 2016 – will.most likely in short supply-instead, after Platts metals news service

Zinc is proceeded in the same direction. At the end of last year, Glencore, one of the world’s largest mining companies, announced the closing of its massive zinc mining operation in Australia, in a move analysts at Woods Mackenzie said, perhaps, “constant exposure to the market.”

What does this mean for silver? This means that they will not be added only less silver scrap for the global market, but likely much less create new things even more basic background for both metals.

It also points the way to higher prices than the big macro – factors that fed misconceptions about the health of the economy, interest rates, the dollar and everything else – precious metals represent a favorable asset class for investors.

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