Dongxing: Global silver demand has entered a stage of structural expansion.

Dongxing released a research report stating that as the photovoltaic, new energy vehicle, and epoxy ethane catalyst industries continue to develop, the consumption of industrial silver will continue to grow as a core driver of increasing silver demand. From 2024 to 2027, global total silver supply will maintain a relatively low growth rate, with annual silver supply increasing from 31,915 tons to 33,039 tons. The CAGR during this period is expected to be 1.2%, mainly because the increase in recycled silver production will not be able to offset the slow growth in mining supply. Combining the forecast for global total silver demand, the supply-demand structure of silver is expected to remain tight from 2025 to 2027, with a supply gap increasing from 6,003 tons in 2024 to 6,507/7,021/7,248 tons. Dongxing's main points are as follows: - Industrial silver is the main driver of silver demand growth. - Global silver demand is mainly composed of industrial demand, physical investment demand, jewelry demand, silverware demand, and photography demand. In 2024, global silver demand is expected to be 37,918 tons, with industrial silver demand accounting for 22,110 tons, or 58% of the total demand. - Physical investment and jewelry silver demand rank second and third, with estimated demand of 6,593 tons (18%) and 6,572 tons (17%) in 2024, respectively. Silverware and photography silver demand are 1,830 tons (5%) and 812 tons (2%), respectively. From 2019 to 2024, the silver market demand continued to expand, with global silver demand increasing from 31,241 tons in 2019 to 37,918 tons in 2024, a total increase of 6,677 tons, with a CAGR of 4% during this period. - Industrial silver demand significantly contributes to the growth of silver consumption. Global industrial silver demand increased from 16,281 tons to 22,110 tons during the same period, an increase of 5,829 tons accounting for 87.3% of the total silver demand growth from 2019 to 2024. The CAGR of industrial silver demand during this period is 6%, higher than the overall silver demand growth rate. - Demand for silver in the photovoltaic industry is still in an upward trend. The consumption of silver paste is essential in the production of photovoltaic cells. Since 2022, the photovoltaic industry has entered a technological transformation, gradually replacing traditional P-type cells with more efficient N-type cells, which consume significantly more silver per unit compared to P-type cells. In recent years, the market penetration of N-type cells has been continuously increasing. By fitting factors such as global photovoltaic capacity, market penetration rate of N-type cells, and unit silver consumption of N-type cells, it is predicted that the global silver consumption for photovoltaics will reach 7,560 tons/7,934 tons/8,156 tons from 2025 to 2027, with an annual growth rate of 4.8%/5.0%/2.8%. - The development of the new energy vehicle industry is driving the growth of silver demand. According to the statistics of the World Silver Association in 2024, the unit silver consumption of hybrid and electric vehicles has increased by 21% and 71%, respectively compared to traditional vehicles. With the continuous development of the new energy vehicle industry, the market penetration rate of new energy vehicles is continuously increasing, providing a continuous increase in silver demand for the industry. By fitting data on the production of new energy and traditional vehicles, unit silver consumption of different vehicle types, and market penetration rates of different vehicle types, it is predicted that the silver consumption for the automotive industry will reach 2,566/2,799/2,926 tons from 2025 to 2027, with annual growth rates of 4.5%/9.1%/12.5%. - The global silver demand is still fermenting. The research found that with the continuous development of the photovoltaic, new energy vehicle, and epoxy ethane catalyst industries, the consumption of industrial silver will continue to be the core driver of increasing silver demand. Silver demand in the photography industry will mainly shrink in the developing countries of East Asia. The demand for silver jewelry and silverware will maintain its dominant position in the Indian market, with an upward trend in silver jewelry demand and relatively stable silverware demand. Net physical investment and net hedge demand are expected to remain stable. - By summarizing the changes in various data, the CAGR of global silver demand from 2024 to 2027 will reach 2%, increasing from 37,918 tons in 2024 to 40,287 tons in 2027. The proportion of industrial demand will increase from 58% in 2024 to 60% in 2027, with the development of the photovoltaic and new energy vehicle industries as the core drivers of silver demand growth. - The gap between silver supply and demand may continue to widen. From 2024 to 2027, global silver supply may increase from 31,915 tons to 33,039 tons, with a CAGR of only 1.2%, maintaining a relatively low growth rate. Combined with the forecast for global silver demand, the supply-demand structure of silver is expected to remain tight from 2025 to 2027, with the supply gap increasing from 6,003 tons in 2024 to 6,507/7,021/7,248 tons. Related companies: Zijin Mining Group (601899.SH), Shanjin International Gold (000975.SZ), Shengda Resources (000603.SZ). Risk Warning: Silver supply grows beyond expectations, silver demand falls short of expectations, global production growth of new energy vehicles lags behind expectations, global photovoltaic capacity additions fall short of expectations, global liquidity tightens beyond expectations, interest rates sharply increase beyond expectations, regional conflicts intensify and spread. Data recommendation.