Exclusive: China's silver output stood at 1,171.6 mt in May

SHANGHAI, Jun 9 (SMM) — According to SMM survey, domestic 1# silver output stood at 1,171.6 mt (including 975.9 mt of mineral silver) in May, down 7.19% from the previous month.

The overall output declined slightly, in line with last month's expectation that domestic 1# silver output may still maintain a stable state in May with a slight fluctuation, and the overall output will decline. Due to the recent fluctuations in the US dollar index, there were less market news than in the past, and some minutes of the Federal Reserve’s meetings were also dull. Apart from capital speculation on inflation, economic data was not surprising to expectations, leading to a slight decrease in the domestic and overseas market fluctuations in May from the previous period. The volatility also slowed down slightly, and as the export spread continued to shrink, the gradual closing of the window for export spreads also reflected in this month's data. The decline in export silver ingots also contributed to the overall decline in output to a certain extent.

However, the silver-containing materials, including anode mud, were still tight in supply, and the competition was still fierce. Therefore, many manufacturers were still stuck in the suspension of production and maintenance, such as Gejiu Lianxing and Chihong Zinc Germanium. Some manufacturers, such as Xiangguang, Mengzi, and Xing'an Silver Lead, also cut production or took maintenance in May. There were also those that resumed production, such as Yunnan Tin Group. This also accounted for the decline in output in May as a whole. One of the reasons for the widening of the domestic and overseas price difference in the early period was also because the domestic silver supply was too large, and the bank funds that had previously participated in the transaction on a large scale suddenly stopped buying goods. That is to say, if there is no receipt of bank funds, it should have been exported long ago. However, the bank funds were not buying goods at that time, which led to the continuous expansion of the silver price discount, so there was a huge price difference between domestic and overseas market. With the recent return of market transactions to normal, the silver price discount recovered, and large-scale production by manufacturers also decreased. It is expected that China's silver output in June may still maintain a stable state, and it is more likely to continue to fluctuate slightly.