Gold and silver have been part of trade and exchange for a very long time. The Egyptians began producing gold shekels around 1500 B.C., and about 700 years later, silver coins started appearing in the same areas. Simply put, these metals have been tied to human life for most of recorded history.
Silver prices have been on the move lately, pushed up by growing tensions in the Middle East, recent interest rate cuts from the European Central Bank, and the uncertainty around the upcoming US election. All this has led more people to seek out safer places to put their money, with silver being one of those go-to choices. This month, Comex silver has surged by 11%, making it the biggest monthly rise since May 2024. So far this year, silver prices are up by 46%, while gold has seen a 33.3% increase since the end of 2023.
On Tuesday, silver prices in the physical market crossed the INR 1 lakh mark. The December futures contract on the MCX (Multi Commodity Exchange of India)—a financial agreement to buy or sell a specific quantity of a commodity, such as silver, at a predetermined price on a set date in December—also hit a record high, reaching INR 99,475 per kilogram in the previous session.
Global Perspective: Comex Silver at a 12-Year High
In global markets, Comex silver prices have stayed above INR 2,901 ($34.50) per ounce, holding steady at their highest point in 12 years. This takes us back to when Robert Kiyosaki, the author of the popular finance book Rich Dad, Poor Dad, had posted on X (formerly Twitter) in 2023, recommending silver as a smart investment. He mentioned that silver is the “second most used commodity after oil.”
Industrial Demand: Silver Surpasses Gold
“Silver, like gold, has long been a backbone of value, but there’s limited data to suggest it will replace gold. But due to high industrial demand, silver actually surpasses gold in some areas,” said Shivank Goswami, marketing and bullion researcher and author of Hedging Bullion Trades: Why Trade Naked, When You Can Hedge?
Silver is widely used in industry, making up more than half of its yearly demand globally over the last five years. This means silver prices are more tied to economic growth than gold, which sees only 10-15% of its annual demand from industrial use, with the rest going mainly to jewelry and investments.
Thanks to its strength, shine and flexibility, silver has also been used for thousands of years in jewelry, tableware, and fine art. Silver’s role in industry, however, comes from its top-notch conductivity for heat and electricity, along with its light sensitivity and anti-bacterial properties.
Today, silver is essential for making solder and brazing alloys, batteries, dental tools, glass coatings, LED chips, medicine, nuclear reactors, photography, solar energy, RFID chips, semiconductors, touch screens, water filters, wood preservatives and countless other applications. This is why it is called “the indispensable metal.”
Investment and Volatility: A Portfolio Perspective
“If you speak on a value basis, then I would say I am extremely bullish on silver. My exposure in terms of portfolio is 70% silver and 30% gold. If we have to make silver as a currency for the masses, then we have to make it range-bound and if you look at charts, silver is sometimes INR 2,523 ($30) dollars an ounce and sometimes INR 1,513 ($18), it is very volatile”, Goswami added.
Talking about the question of sustainability in mining these two metals, Asish Jain, an experienced jeweller and a tech and innovation enthusiast said, “ If you look at a market like India, the recycling part, which is the refining part, is dominated by small scale refiners to the extent of 60-70%. Large scale refineries deal more with gold than silver. But in the case of silver we see that the large extent of refining is carried out by SMAs, and they do not really care about sustainability and environmental issues, they want to do it quickly and get it over with. This happens in almost all the growing countries. In mining, big players make claims but it is impossible to keep a check on them. Sustainability in this area is therefore a big question mark.”
As silver continues to capture attention, its dual role as both a valuable metal and industrial staple underscores its unique place in today’s economic landscape. With global demand rising, silver’s value is projected to grow, driven by its essential use in technology, renewable energy, and electronics manufacturing. The metal’s significant industrial applications, from electronics to solar panels, keep it in high demand, while its volatility and complex recycling processes raise questions about sustainability. Despite these challenges, silver’s status as “the indispensable metal” makes it an attractive choice for investors and industries alike. Whether viewed as a safe-haven asset or essential resource, silver’s importance—and value—are unlikely to diminish, remaining key players in global markets for years to come.
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