China To Be Key Player In Global Silver Market
(Kitco News) -China will play a majorrole in the global silver market for years to come, both as an industrial userand a silver miner, said the Silver Institute in a report released Wednesday.
The report, titled “Prospects for the Chinese Silver Market,” was released at the 17th China International SilverConference in Shenzhen. The report was researched and prepared by theLondon-based precious-metals consultancy Metals Focus.
The report called China byfar the largest consumer of silver globally, accounting for 18% of globalfabrication demand in recent years. Further, it said that China is thethird-largest silver-producing country, as well as a key nation for processingprimary raw materials from around the world.
China’s photovoltaicdemand for silver in solar applications rose in recent years to an estimated 65million ounces in 2017, the report said. In fact, more than 70% of global solarpanel production takes place in China and local powder fabricators can onlyprovide a portion of the powder and paste for manufacturing, therefore relyingon imported silver to fulfill requirements.
“Although policy changeswill most likely see volumes decline modestly this year, the long-term uptrendis expected to resume in 2019, assisted by still sizable local installationsand strong sales abroad,” the Silver Institute said.
Additionally, growthacross a wide range of end-use applications is fortifying electronic andelectrical demand, the report said.
“Significant areas ofgrowth include touch panels, light emitting diodes and equipment used inelectricity generation,” the Silver Institute said. “Chinese consumption ofsilver for electronic and electrical uses was estimated at 78 million ounces in2017 and is forecast to grow modestly this year.”
The report also calls forgains in demand for brazing applications that rely on silver during the yearsahead as the country remains focused on developing its infrastructure. Brazingalloys and solders accounted for 24 million ounces of silver demand in 2017.
“A wide range of end-useapplications, including railway infrastructure development, increasing carsales, refrigeration and air conditioning should fuel this growth,” the SilverInstitute said.
Jewelry and silverwaredemand has fallen in China during recent years, with combined fabricationreaching 29 million ounces last year, the report said. However, the authors ofthe report also said they believe the end of this downtrend is near, withsilverware already turning the corner and silver-jewelry demand expected tostart growing again around 2020.
By Allen SykoraFor Kitco News
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