Silver Scrap Supply "Falls 30%" from 2011 Peak

Refiner says scrap silver supplies retreat further from 2011 peak as prices fall...

 

SILVER SCRAP supplies from North America and Europe have fallen up to 30% from the peak of 2011, a leading refiner told an industry conference Wednesday.

 

Speaking at the Silver Industrial Conference in Washington, Grant Angwin of Johnson Matthey – which produces London Good Delivery silver bars at its Salt Lake City plant in the US, and at Brampton in Canada – said that flows of existing above-ground silver, back to market, have fallen 20-30% over the last two years.

 

Scrap silver supplies jumped 12% by weight in 2011 to a record 8,000 tonnes, according to the Silver Survey from consultants Thomson-Reuters GFMS, produced annually for the Silver Institute, which hosted this week's Industry Conference in Washington

 

The peak silver price of nearly $50 per ounce in spring 2011 saw several jewelry specialists plead with the public to stop selling fine gold and silverware for scrap, a repeat of the pleas made by fine-art auctioneers at the top of the previous bull market in 1980.

 

Silver prices have now retreated more than 50% from spring 2011. Flows of silver scrap from existing holders – whether recycled from industrial and technological use, or sold for melting by investors or art and jewelry owners – slipped last year by around 2% to below 7,900 tonnes, according to Silver Insitute figures.

 

Even with scrap flows falling further however with the lower price, the silver market is set to see a "surplus" of supply over demand in 2014, according to HSBC analyst James Steel.

 

Also speaking at the Silver Industry Conference, Steel pointed to rising silver mine output from Latin America, plus an increase in the volume of silver being produced as a byproduct of copper mining.

 

Dedicated silver mines accounted for less than one third of total silver mining output in 2012. So-called primary supply grew by less than 2% to 6,890 tonnes according to Thomson-Reuters GFMS. The other 70% of silver mine supply last year came as a byproduct of gold, zinc, lead, copper and other mineral output.