Analyst Forecasts Silver Shortage, Price Increases As Consumers Tap Dwindling Secondary Inventories
Peter Krauth, a silver market analyst and author of “The Great Silver Bull,” has predicted an upcoming silver shortage produced by the increased demand for the precious metal for different applications. Krauth states that demand for silver has outpaced supply, and there are probably 12 to 24 months of silver available before inventories run out.
Silver to Skyrocket as Above Ground Inventories Collapse, Analyst Claims
Silver is making headlines again due to the forecast of a price explosion in the next two or three years. Peter Krauth, a major silver market analyst and author of “The Great Silver Bull” believes that silver is especially positioned to be one of the largest trades in the commodities market in the near future.
In a recent interview, Krauth explained that demand has been rising with almost the same supply for a while, with silver maintaining the same price range. Further investigation led him to conclude that big silver consumers were tapping secondary above-ground inventories corresponding to the largest silver futures markets (Comex, LBMA, and Shanghai) and exchange-traded funds (EFTs), given that these have seen their inventories drop 40% on average during the last three years.
Krauth predicts that, if this situation continues, above-ground inventories of these sources will collapse in 12 to 24 months, setting the stage for silver prices to explode as shortages affect the supply of the precious metal. In addition, he explained that the forecast of new mines going into production might even be negative in the future, which might accentuate this shortage situation.
Furthermore, Chinese consumers are already preparing for this upcoming supply crisis. Krauth stated that he has received reports from silver producers that Chinese consumers are paying over $3 per ounce more than international prices, accumulating more of this supply. This might accentuate the crisis in the West, given that Asian producers are prepared to pay over-market prices for the metal.
Other analysts have also predicted a rise in the price of commodities, including precious metals, for the near future. In May, Peter Schiff recommended investors to take advantage “of what could be the biggest precious metals bull market in history.”
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