The global silver market continues to face a supply shortage for the sixth consecutive year. According to estimates by the Silver Institute, the deficit is projected to increase by 15% in 2026, reaching 46.3 million troy ounces.

High investment demand remains the primary driving factor. While consumption of bars and coins could rise by 18%, aggregate demand is expected to decline by 2% due to reduced usage of the metal in industrial applications, jewelry, photography, and silverware production.

Supply is also expected to continue its downward trend. A 2% contraction is anticipated in 2026, driven by lower mine output and reduced hedging activity among producers. This decline will be partially offset by a 7% increase in recycling volumes.

Short-term price prospects remain under pressure due to geopolitical tensions in the Middle East. However, long-term expectations remain positive: slowing economic growth and declining real bond yields could bolster demand for safe-haven assets, including silver.