India Demand Drives Up Silver Jewellery Fabrication +29% To Record High In 2022

Global silver demand reached an all-time high of 1.242 billion ounces (Boz) in 2022, thanks to record silver demand across all major categories, according to the findings of the World Silver Survey 2023, released by the Silver Institute and researched and produced by Metals Focus, an independent precious metals consultancy.

Silver jewellery demand rose by 29%, silverware grew 80%, and industrial demand and physical investment rose by 5% and 22% respectively. These gains led to the total global silver demand milestone, marking a 38% increase from 2020 as the world economies recover from the pandemic. However, mine production was lower, resulting in the second consecutive annual structural deficit at a significant 237.7 million ounces (Moz) last year.

Silver jewellery fabrication soared 29% to a record level last year at 234.1 Moz, mainly driven by India, where pent-up demand and higher purities, combined with heavy restocking by retailers, saw volumes double compared to 2021. Recycling activity rose for a third year in a row, driven by the 7% rise in industrial scrap.

However, jewellery and silverware recycling had only marginal gains. Physical silver investment also rose for a fifth consecutive year, reaching a new high of 332.9 Moz. For 2023, experts predict a large deficit for silver of 142.1 Moz, the second-largest deficit in more than 20 years, due to an expected modest gain in supply and healthy demand across all sectors.

As with jewellery, gains in silverware were almost entirely due to India, where demand more than doubled last year on the back of employment and incomes returning to pre-pandemic levels, the report noted.

This year is expected to be another of solid silver demand. Although bar & coin demand and jewellery fabrication are expected to fall short of last year’s exceptional levels, both are forecast to remain historically high. Supply, by contrast, is expected to achieve only low single-digit gains. As a result, this year will also see another large deficit for silver, amounting to a projected 142.1 Moz, which would be the second-largest deficit in more than 20 years. Adding up the supply shortfalls of 2021-2023, global silver inventories by the end of this year will have fallen by 430.9 Moz from their end-2020 peak. To put this into perspective, it is equivalent to more than half of this year’s forecasted annual mine production, and more than half of the inventories presently held in London vaults offering custodian services.