Contact us
CALL US NOW 1-888-GOLD-160
(1-888-465-3160)

AI Boom Could Boost Demand for Precious Metals

  by    0   0

The boom in AI could mean a boom in industrial demand for precious metals in 2024.

Metals Focus, an independent precious metals research consultancy, released a note recently that said it expects the increased demand for chips powering AI technology to drive “widespread support for a range of precious metals bearing components.”

Industrial and tech demand for precious metals has been muted this year due to sluggish global economic activity. For instance, the demand for gold in the tech and industrial sector was down 3% year-on-year in the third quarter with offtake in the electronics sector dropping by 4%.

Metals Focus said increased demand due to the evolution of AI could reverse this trend in the coming year, not just for gold, but also for silver, platinum, and palladium.

Expected upside from several applications that are gradually maturing should help support the recovery in industrial offtake next year.”

Metals Focus projects that shipping growth for AI servers and switches will rise by double digits over the next few years to keep up with the evolution of AI algorithms. This will stimulate precious metals demand.

Demand is expected to rise for “platinum alloys used in chip manufacturing, silver-palladium Ag-Pd multi-layer ceramic capacitors (MLCCs) in high power components, gold bonding wire in chip and memory packages, gold plating in printed circuit boards and palladium plating on lead frame.”

AI-driven demand will likely have the most significant impact on the silver market. Silver possesses the lowest electrical resistance among all metals at standard temperatures and is a vital component in many electronic applications. Tech and industrial applications account for more than half of global silver demand.

The silver market already faces the potential for significant supply constraints due to growing demand in the green energy sector. Silver demand was at record levels in 2022 and will likely run hot over the next several decades.

According to a research paper by scientists at the University of New South Wales, solar manufacturers will likely require over 20% of the current annual silver supply by 2027. And by 2050, solar panel production will use approximately 85–98% of current global silver reserves.

Industry/tech only represents about 7%  of global gold demand, but this still amounted to just over 75 tons of gold in the third quarter.

Get Peter Schiff’s key gold headlines in your inbox every week – click here – for a free subscription to his exclusive weekly email updates.
Interested in learning how to buy gold and buy silver?
Call 1-888-GOLD-160 and speak with a Precious Metals Specialist today!

Related Posts

World Gold Council: “Blistering Central Bank Buying” Fuels Strong Gold Demand

Total gold demand hit an all-time high in 2023, according to a recent report released by the World Gold Council. Last week, the World Gold Council (WGC) released its Gold Demand Trends report, which tracks developments in the demand for and use of gold around the world. Excluding over-the-counter (OTC) trade, 2023 gold demand fell slightly from 2022 […]

READ MORE →

VIX – The Calm Before the Storm

The VIX, often referred to as ‘Wall Street’s fear gauge,‘ is currently portraying a sense of calm among investors, registering well below the 20 level. 

READ MORE →

Four States Consider Lifting Taxes on Precious Metals

Citizens of Georgia, Kentucky, Wisconsin, and Kansas may soon enjoy lower taxes on precious metals if recently introduced pro-metal bills are made law in 2024.

READ MORE →

Inflation Persists As Fed Signals Rate Cuts

printing pressThe U.S. Bureau of Labor Statistics (BLS) recently released two inflation reports highlighting inflation figures for December 2023. Here’s what they showed: 

READ MORE →

SEC Greenlights Bitcoin ETFs Amidst Social Media Whoopsie

SEC announce bitcoin ETFOn Wednesday, January 10th, the Securities and Exchange Commission (SEC) made an interesting decision, voting to allow everyday folks to participate in spot bitcoin ETFs. This move marks an opening for a broader audience to delve into Bitcoin speculation. The approved ETFs are set to be listed on various exchanges, including Nasdaq, the New York […]

READ MORE →

Comments are closed.

Call Now