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Silver Supply Setback

Written on 8th April, 2020

Mexico’s one-month shutdown is expected to impact silver supply this year, with key producers such as Pan American
Silver and Newmont Goldcorp already suspending operations. Mexico is the largest producer of silver (196.6 moz in
2018), accounting for 23% of global supply (source: The Silver Institute). Silver already faces a weak fundamental
outlook, with a lack of industrial demand keeping the price suppressed. With the metal readily available, a supply setback
is unlikely to make much difference. For now, silver remains ‘cheap’ relative to gold and is seeing stronger demand for
bars and coins, but still not enough to see it outperform.