Why Silver Prices Are Setting Up to Skyrocket
Silver is overlooked for now, but eventually, supply and demand will matter—and when that happens, silver prices could go significantly higher than they are now. Don’t rule out $50.00-an-ounce silver just yet. This could happen much sooner than many think.
Silver isn’t just a precious metal; it has immense industrial uses as well. In fact, about 50% of the total annual silver supply is used for industrial applications.
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There’s one place that shouldn’t be ignored when looking at where silver prices could be headed next: the solar energy industry.
Here’s a fact: you can’t have efficient solar energy without silver. And guess what? The demand for solar energy is increasing. This is happening as innovation has led to lower prices per solar panel Plus, governments around the world are tirelessly looking for ways to reduce carbon emissions, and solar energy offers a great solution.
Just to give you some perspective: according to BloombergNEF, global solar panel installation is expected to grow by 56% in 2023! (Source: “3Q 2023 Global PV Market Outlook,” BloombergNEF, September 5, 2023.)
What’s ahead in the coming years? To say the least, there’s a “solar rush” in the making. The global outlook for solar panel installations is as shiny as ever.
With this, the manufacturing of solar panels has been skyrocketing. According to the International Energy Agency (IEA), the manufacturing capacity of solar panels is expected to double by 2024 and grow much more in the coming years. (Source: “Renewable Power on Course to Shatter More Records as Countries Around the World Speed Up Deployment,” International Energy Agency, June 1, 2023.)
Silver Price Outlook Shiny: $50/Ounce Shouldn’t Be Ruled Out
There’s really no rocket science here: the higher the production of solar panels goes, the more silver will be needed. All of the excess silver demand from the solar industry could really distort the supply and demand sides of the silver market and send silver prices soaring.
Dear reader, do you know what I find most interesting when talking about silver prices headed to $50.00 an ounce? The backlash I get: “How can this be possible?”
What’s so outlandish about the question is that the financial world’s participants are perfectly fine with the idea that assets like Bitcoin could go to $100,000 or that certain stocks could get multi-trillion-dollar valuations. However, they deem metals like silver to be useless when they clearly are not, and their demand is increasing.
I reiterate what I said earlier: the silver market is showing signs of high demand, and the supply side isn’t as strong as before. I believe there’s a perfect storm forming here, and it could mean much higher silver prices. I personally wouldn’t be shocked if silver prices surpass their previous high of $50.00 per ounce.
Obviously, time will tell. In the meantime, though, I think silver miners could be worth a look for investors who are willing to take on some risk.
As silver prices have stayed low, and have been volatile over the past little while, investors have ditched silver mining stocks. They are down, but not out. I see a decent number of them selling for pennies on the dollar. As silver prices soar, so will the prices of silver mining stocks, and that could mean immense returns for those who own them.
