Sharply rising industrial demand for silver, driven by its role in making photovoltaic panels, suggests a potential mid-century scarcity, Hecla Mining (NYSE: HL) president and CEO Phil Baker told The Northern Miner’s Energy Transition Metals Summit in Washington, D.C.
Projections show that in two and half decades a third of all energy will be generated through solar technology. This burgeoning demand, Baker said, combined with the existing industrial and investment needs for silver, points towards a potential massive supply deficit.
“At some point, silver is going to be very hard to come by. There’s lots of silver, but the question is at what price,” the CEO said during an April 29 presentation on What is Silver’s place in the Energy Transition? “To the extent that there are people here that represent companies that need to have silver, they should absolutely not be short. The same thing would apply to investors; it’s a real opportunity for investors.”
The gravity of this issue becomes apparent following three years of substantial deficits over the past few years, with a cumulative shortfall of over 500 million ounces. In 2024 alone, the deficit is expected to be around 200 million oz., given total demand of around 1.2 billion oz. versus production of a little over a billion ounces.
The mining industry’s limited capacity to ramp up production and the lengthy timeline required to bring new mines into operation exacerbates the challenge of meeting this soaring demand. Consequently, above-ground silver stocks are being depleted, raising concerns about silver’s long-term availability and price stability.
The summit ran in coordination with Precious Metals Summit Conferences. Watch the full presentation below.
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