Surging Solar Industry & Low Production May Boost Silver

The use of silver in emerging technologies, particularly solar energy production, sets the stage for surging demand and rapidly rising silver prices in the future.

That means the silver market provides some great opportunities for investors.

According to a report in The Telegraph, analysts expect the demand for solar energy to increase 30% in 2015 alone. Silver paste serves as a key component in crystalline silicon photovoltaic (PV) cells, and the increased demand for solar energy will likely drive a concurrent demand for silver. Analysts estimate PV cell production alone will require some 70 million ounces of silver through 2015 to the beginning of 2016.

Developing countries such as China and India continue to make solar power a larger part of their electricity generating mix. India’s silver imports alone increased 180% over a two-year period, according to Casey Research.

Telegraph commodities editor Andrew Critchlow said an international binding agreement on climate change this summer in Paris could boost demand for solar cells even higher.

Such a deal would result in already strong demand for PV cells increasing further as major developing economies such as India and China increase the contribution that solar makes to their overall power generation network.”

The increased demand for other cutting-edge technologies will also likely push the demand for silver higher. Solid-state lighting (SSL), radio-frequency identification chips (RFID), and hyper-efficient batteries all utilize silver in their production.

Coupled with an anticipated slowdown in silver production, the increased demand sets the stage for a surge in silver prices. According to the Thomson Reuters survey, silver mine production increased only 5% last year.

“Analysts fear that a lack of investment by silver miners could see production plateau over the next few years at a time when demand from the fast-growing solar power industry is expected to pick up rapidly,” Critchlow wrote.

The current silver market provides fertile ground for investors, with the price significantly undervalued at this time. Casey Research senior precious metal analyst Jeff Clark points out that the price of silver currently sits below its pre-2008 crash level and below the price before the first round of quantitative easing.

“It’s basically trading as if no money has been printed,” Clark wrote. “There is a clear disconnect between this precious metal and its price.”

All of this means the white metal has far more upside potential than gold.

Want more information on silver investing? You can find everything you need to know in the newly revised edition of The Powerful Case for Silver. This exclusive special report features updated information on the latest industry statistics and news affecting physical silver. Click here to download it for free.

Get Peter Schiff’s latest gold market analysis – click here – for a free subscription to his exclusive weekly email updates.
Interested in learning more about physical gold and silver?
Call 1-888-GOLD-160 and speak with a Precious Metals Specialist today!