SILVER surged to an unprecedented $53 per ounce on Tuesday, marking an 85% gain this year as a supply crisis in London propelled prices beyond gold’s rally.
The shortage has pushed London prices $1 to $2 above New York Comex futures, with inventories at historic lows. Gold also reached a record $4,179/oz, up 59% for the year.
Randy Smallwood, CEO of Wheaton Precious Metals, told the Financial Times on Tuesday the market faced acute shortages. “There is a serious squeeze on, and you can’t buy substantive physical volumes of silver, it’s just not available,” he said.
The crisis has prompted traders to airlift silver from New York to London – an extraordinary measure typically reserved for gold, as silver normally travels by sea, said the newspaper.
Nicky Shiels, analyst at MKS Pamp, said the “unprecedented tightness in silver . . . has left the linchpin of the physical market in London broken”.
US tariff concerns have exacerbated the dislocation, with metal accumulating in New York as traders await Washington’s decision on potential import levies.
“The metal is in the wrong place, it has gone to New York,” said Adrian Ash, head of research at BullionVault. He added that holders were reluctant to move silver ahead of possible Section 232 tariffs.
Suki Cooper, an analyst at Standard Chartered, said “surging demand from India ahead of festival and wedding related buying” had depleted London stocks.
The rally has been fuelled by investors treating silver as a gold alternative, plus industrial demand from electronics and solar panel manufacturers, said the Financial Times. Prices now exceed the famous 1980 Hunt brothers squeeze, it said.
