Mumbai/London:
The global silver market is grappling with a major supply crisis as surging demand in India coincides with a significant short squeeze in London. The confluence of these factors has caused unprecedented market disruptions and record-high prices.
Spike in India’s demand
With the onset of the festive season, silver purchases in India surged dramatically. Dealers and refineries reported running out of stock, marking a historic shortage in the country. The spike in demand is largely driven by jewellery purchases and festive buying, which has left the domestic supply chain struggling to keep up.
Short squeeze in London
At the same time, the London bullion market is facing a severe supply crunch. Traders are unable to meet delivery commitments due to depleted inventories, creating panic in the market. Analysts predict that continued shortages could drive silver prices even higher in the coming weeks.
Record-high prices
Silver prices have already surged above $51 per ounce, fueled by increased industrial demand—especially from the solar energy sector—and speculative investments. The ongoing shortage has intensified price volatility, causing concerns for both investors and consumers worldwide.
Conclusion
The global silver market is currently under significant stress, with shortages in both India and London driving record prices. Unless supply constraints ease, the market may face continued volatility, affecting industrial usage, jewellery production, and investment trends globally.