The global silver market realised growth in every demand category in 2021, marking the first time all key sectors rose in tandem since 1997, according to the World Silver Survey 2022, released by the Silver Institute.
Surpassing pre-pandemic volumes, total global silver demand achieved its highest level since 2015, surging 19% to 1.05 billion ounces (Boz) last year. Leading the way was an all-time high for silver’s use in industrial applications, rising 9% to 508.2 million ounces (Moz).
Silver jewellery fabrication jumped by 21% in 2021 to 181.4 Moz. On top of soaring consumption, fabricators also benefited from rebuilding stocks, which had fallen in 2020.
India paved the way for silver jewellery demand, with a 45% jump to 58.7 Moz, while Thailand posted 24.8 Moz, followed by Italy at 20.4 Moz and the United States with 13.2 Moz, the report noted.
Coming off a somewhat disappointing 2020, silverware demand recovered by 32% in 2021 to reach 42.7 Moz. India led the world in silverware offtake at 24.4 Moz, followed by Nepal at 4.8 Moz and China at 2.7 Moz.
Physical silver investment (sales of silver coins and bars) leaped by 36% to 278.7 Moz, its highest level since 2015, as retail investors in North America and Europe, motivated by safe-haven and inflationary concerns, took advantage of periodically lower silver prices to purchase coins and bars.
In India, sales of silver bars and coins more than tripled, with much of the growth emerging in the second half of last year.
Of note, last year, the silver market experienced its first deficit since 2015, at 51.8 Moz, its most significant shortage since 2010.
Global mined silver production grew by 5.3% in 2021, reaching 822.6 Moz. This increase was the most significant annual growth in mined silver supply since 2013 and was driven by the recovery in output following COVID-19 related disruption in 2020.
Led by a jump in industrial scrap supply, global silver recycling climbed by almost 7% in 2021, to an eight-year high of 173 Moz. In its outlook for 2022, the Silver Institute expects jewellery and silverware demand to continue their post-pandemic recovery this year. Physical silver investment is likely to be broadly flat this year, as a modest fall in western investment will be offset by further gains in India.