Industrial Gold Equivalent: Silver Demonstrates Value for Manufacturing - Consequently, for Investors as Well.
In the world of precious metals, silver has been experiencing a downturn as prices and mining valuations reach their lowest point in eight months due to recent sell-offs. However, the future looks promising as various reports suggest a significant increase in silver demand, particularly in the photovoltaic industry.
According to estimates from the Silver Institute and Baker Steel Capital Managers LLP, the development of photovoltaics is expected to surge by 180% in the next ten years, 459% in the next twenty years, and an astounding 720% by 2050. This growth is set to have a profound impact on the silver market, with the photovoltaic industry expected to account for half of the overall silver demand in 2021.
The increasing demand for photovoltaics is driven by the rise in solar energy usage, a trend that is expected to continue due to the development of green technologies and currency devaluation resulting from rising inflation. This increased demand could potentially offset the recent sell-offs and low valuations in the silver market, signalling a recovery in the coming months, as predicted by Baker Steel Capital Managers LLP.
The photovoltaic industry's demand for silver is significant, with the industry demanding approximately 15,142 tonnes of silver in 2020, compared to the gold industry's demand of 301.9 tonnes. This makes silver more extensively used in industries compared to gold, with a significantly higher demand volume.
The Silver Institute reported the data for silver industry demand, while the World Gold Council provided the data for gold industry demand. Interestingly, in 2020, the demand for silver by industry was approximately 50 times greater than the demand for gold.
Katusa Research also predicts a significant increase in silver demand in the photovoltaic industry over the next decades. The company suggests that the photovoltaic industry's demand for silver could soon match the demand from the photography film industry in the past, underscoring the potential impact of the photovoltaic industry on the silver market.
However, even if silver is replaced by cheaper materials in certain applications, it still seems promising for the photovoltaic industry due to its unique properties that contribute to the efficiency and longevity of solar panels. This makes silver a crucial component in the transition towards a more sustainable energy future.
In conclusion, while the silver market is currently experiencing a downturn, the increasing demand from the photovoltaic industry, driven by the rise in solar energy usage, offers a glimmer of hope for a recovery in the coming months. As the world continues to transition towards renewable energy sources, the demand for silver in the photovoltaic industry is expected to grow, making silver a valuable asset in the pursuit of a sustainable future.
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