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Energy
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General Market Commentary
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Precious Metals
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General Energy
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General Market Commentary
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General Precious Metals
The most overlooked energy mineral of them all
There is a lot of buzz about the fortunes to be made on “battery metals.” That is with good reason, as the accelerating global adoption of large-battery electric vehicles makes headlines every day.
But this is not just about cars, batteries, or metals. We’re witnessing a worldwide energy paradigm shift.
The raw materials that will see soaring demand include the metals making investment headlines, like lithium and cobalt, but also nonmetallic minerals like graphite. And their use in batteries is only half the story. The other half is in the solar, wind, and other “green” energy sources that are getting cheap enough to start competing with oil. For example, wind turbines require rare earth elements for their high-performance magnets.
The most overlooked energy mineral of them all, however, is silver.
Whether it is cheap solar panels from China or a high-end Tesla solar roof, all commercial solar panels on the market today use substantial amounts of silver. The average 1.8-square-meter solar panel includes about 20 grams of silver as an essential layer in its photovoltaic surfaces. The math works out to just over a kilo of silver per 1,000 square feet of solar panels.
For those who look forward to driving their electric roadsters around “for free,” silver is just as vital as lithium or cobalt.
And yet, most people think of silver as a precious metal—the poor man’s gold—part of a completely different market. And that is true. Silver prices move within a variable range around gold prices, which are subject to safe-haven demand more than industrial demand. There’s no question about this.
On the other hand, silver is largely consumed as an industrial metal rather than vaulted as a precious metal. Film and paper photography used to consume the lion’s share of the world’s silver output. Now it’s electronics, medical, and increasingly, photovoltaics.
This sets up a unique situation for silver. It is produced as a byproduct, mostly of copper and gold mines. Even the richest silver-primary mines in the world are really lead and/or zinc mines with high-grade silver in the mix. What happens if demand for these other metals (which are not used in solar panels) were to drop at the same time as demand for silver increased?