[SMM Analysis] Silver Exports Expected to Increase Throughout 2024, Unexpected Surge in Imported Silver Ingots

The total annual export volume of silver in 2024 reached 4,244.3 mt, an increase of 178.4 mt compared to the previous year, up 4.35% YoY, showing a continuous growth trend. Below are the highlights of silver imports and exports in 2024.

I. Continuous Increase in Export Volume
Domestic associated silver ores usually have a relatively low silver grade, while domestic smelters require silver-containing materials for their furnaces. Therefore, the domestic demand for high-silver-content ores remains strong. This year, the volume of high-silver-content ores imported domestically continued to grow. However, due to price spread factors, some refined silver ingots needed to be exported, driving the continuous increase in silver ingot exports.
II. Import Window Opened in June-July
From June to July 2024, there was an unexpected return of silver to the domestic market. Prior to this, the annual domestic silver import volume remained between 20-60 mt, mainly for toll processing. However, in June-July this year, domestic silver consumption was strong, and market bullish sentiment surged. Domestic prices were briefly higher than overseas tax-inclusive prices. Domestic traders took advantage of this short-lived price difference for arbitrage, importing spot cargoes back to the domestic market. These silver ingots were originally orders processed domestically and exported to London, and their return from Hong Kong reduced overseas transportation costs. However, with the return of imported silver, the domestic supply surplus increased, and spot premiums/discounts declined. Since exported silver ingots are usually large 30-kg ingots unsuitable for domestic production needs, as the domestic-foreign price spread narrowed, the market offset the spot price difference through futures gains and sold at low premiums. Therefore, it is expected that by 2025, the likelihood of a long-term open silver import window in the domestic market will be relatively small. Even if such a situation occurs in the short term, the probability of the market importing silver ingots will remain low.

》View SMM Precious Metals Spot Prices