Index Rebalancing Temporarily Suppressed Silver Price Momentum, Post-Holiday Investment Demand Cools, Spot Premiums Return [SMM Silver Market Weekly Review]

From a macro perspective, geopolitical developments such as US military actions against Venezuela and the ongoing Russia-Ukraine conflict significantly boosted safe-haven demand in early 2026, providing short-term support for precious metal prices. Approaching the weekend, multiple institutions issued warnings that, due to the upcoming annual rebalancing of the Bloomberg Commodity Index from January 8 to 14, large-scale short-term silver selling could exert greater pressure on silver prices, dampening short-term upward momentum for precious metals. Although the core drivers—such as the US Fed's ongoing easing cycle and rigid demand from the green energy sector—remain intact, and despite short-term corrections, medium and long-term silver prices are expected to hold up well. Short-term risks of a pullback after the substantial rally remain, with market liquidity risks and diverging institutional views adding to price volatility uncertainty.

[Economic Data]

Bullish:

US December ISM Manufacturing PMI: actual 47.9, previous 48.2, expected 48.3
US EIA Crude Oil Inventories for the week ending Jan 2: actual -3.832 million barrels, previous -1.934 million barrels, expected 447,000 barrels
US December ADP Employment Change: actual 41,000, previous -29,000, expected 47,000

[Spot Market] In the domestic silver spot market, pre-New Year investment demand faded after the holiday, while industrial end-users conducted small stockpiling for rigid needs. Approaching the weekend, after smelters delivered long-term contracts as scheduled, spot premiums fell rapidly. At the start of the week, supply was tight in the spot market; smelters in Henan and Yunnan raised TD premiums to 150-200 yuan/kg with limited transactions, and traders also mainly executed small orders at high premiums. In Shanghai, large smelters occasionally reported TD premiums of 200-350 yuan/kg for silver ingots, with high premium quotes mainly driven by investment demand and rigid needs from end-users with monthly silver consumption below 1 mt. Toward the weekend, as silver prices moved in the doldrums, investment demand cooled in Shenzhen, with some tax-exclusive offers transacted at parity with TD. In Shanghai, mainstream quotations for national standard silver ingots against TD dropped to 100-150 yuan/kg. Industrial rigid demand for products like silver nitrate and solder actively sought quotes and negotiated, causing spot premiums to gradually normalize; post-holiday spot market transactions saw a slight recovery.

PV Silver Paste: This week, the reference average price for solar cell rear-side silver paste was 11,473-12,303 yuan/kg; for solar cell front-side finger, the reference average was 17,244-18,489 yuan/kg; for solar cell front-side busbar, the reference average was 17,194-18,439 yuan/kg.