Is silver really in such short supply that not only could it double in value from its current price, but triple or even quadruple? First Majestic Silver (NYSE:AG) CEO Keith Neumeyer says you would be crazy to think silver will be trading at $30 or $50 per ounce within the next few years. Nope, instead he believes silver will hit $140 per ounce, a ninefold increase from where it stands today.
The notion that silver could rise by so much seems fantastical, particularly since the metal has never hit $50 per ounce, but Neumeyer isn’t just some crystal-ball gazer pulling numbers out of the air. As head of the second-biggest silver miner in Mexico, the country that produces more silver than anywhere else in the world, he has some insight into the forces moving the metal.
Gold medalist in silver
First Majestic is one of a handful of senior miners producing more than 10 million ounces of silver annually, a rarified group that includes Pan American Silver (NASDAQ:PAAS), Coeur Mining (NYSE:CDE), and Fresnillo.
In an interview with Bloomberg News, Neumeyer says there are some very good reasons why he expects the gray metal to go stratospheric:
Silver is not a precious metal, but a strategic one that’s increasingly being used for industrial purposes.
Only gold outstrips silver’s usefulness in certain applications, but gold is too expensive to use.
Despite their seeming abundance, silver supplies have been in deficit every year since 2000.
For the first time ever, a major Japanese electronics company contacted First Majestic to sign an agreement that would lock in its future supply, suggesting manufacturers are worried about where their silver will come from.
There seems to be some basis for what Neumeyer is saying. In the heady commodities rally that’s taken shape in 2016, silver has leapt to the forefront of performance among precious metals, surpassing gold with a near 15% gain year to date (it was up over 25% at one point in late April). Neumeyer also says his triple-digit silver price forecast is predicated on the price of the yellow metal not moving, but he doesn’t see that as likely over the long haul.
Indeed, in a follow-up interview with Future Money Trends, he says $10,000 per ounce gold is not out of the question, which would suggest silver hitting $1,000 per ounce.
How high is high?
OK, this does seem like crazy talk, but the rationale for his belief is the world is increasingly using gadgets like mobile phones and flat-panel TVs that rely upon silver for its conductivity. Neumeyer notes only gold surpasses silver in its ability to conduct electricity, but its lofty price makes it prohibitive to use.
According to the market researchers at Gartner, mobile phones will grow 7% globally in 2016, to over 1.9 billion units, and will climb to more than 2 billion units by 2018, while Future Market Insights says the market for flat-panel displays will increase at a compounded 5.8% rate through 2020.
And Bloomberg reports that when you add in the demand from investments, coins, and inventories necessary to settle trades, silver has been in short supply for over 15 years. Yet as the price of silver has fallen, producers have been forced to cut back on production.
First Majestic, for example, saw the amount of silver it produced in 2015 fall to 11.1 million ounces from 11.7 million the year before. Similarly, Coeur Mining said silver production fell from 17.2 million ounces in 2014 to 15.9 million ounces last year. And though Pan American Silver produced a record 26.1 million ounces last year, helped along by acquisitions it’s made over the years, it forecasts it will only produce between 24 million and 25 million ounces this year. In fact, overall silver production will fall this year for the first time since 2011.
Pie in the sky?
So Neumeyer’s prediction might not be as far-fetched as it seems, even if he remains something of a lone voice. On average, analysts only anticipate silver trading in the low $20s per ounce by 2019, and that’s because, although there are no easy substitutes for silver, its low cost has meant there’s been no need to even look. Should prices spike as Neumeyer suggests, there would be a mad rush to either produce more or find substitutes.
That happened in the market for rare-earth minerals when China suddenly imposed controls on their export. As the country is virtually their only producer, the restriction caused prices to rise astronomically. But not only did more mining suddenly occur for them as miners wanted to cash in on the potential profits, substitutes quickly emerged. Toyota and General Motors began making cars with induction motors rather than with rare-earth magnets; General Electric developed wind turbine generators that relied less upon rare-earth permanent magnets; and W.R. Grace offered fluid catalytic cracking catalysts that contained fewer rare-earth components. Just as quickly as they rose, prices of rare-earth minerals cratered.
Even so, while there’s plenty of reason to suspect silver’s price will be rising in the future, getting from $16 per ounce to triple digits in three years’ time seems implausible, though it may still be a better bet than oil.
cialis samples 9 levitra at walmart how does viagra work tamoxifen bijwerkingen ciprofloxacin side effects viagra effects cealis cialis samples overnight lexapro generic cialis coupon 20 mg azithromycin drug class viagra ohne rezept auf rechnung viagra from canada finasteride long term effects tamoxifen cialis pricing cialis professional how to wean off lexapro finasteride 5 mg levitra 20 mg cost walmart lexapro medication ciprofloxacin side effects in women viagra canada viagra wikipedia levitra 20mg cost per pill azithromycin three times a week viagra without a doctor prescription usa lexapro withdrawal how to wean off lexapro without withdrawals how long does viagra last viagra prices acyclovir for shingles cialis herbal viagra levitra 20 mg precio farmacia cialis savings card cilias viagra uk equipe argentine viagra viagra on line no prec viagra for women cialis generic availability women viagra zithromax z-pak side effects of lexapro in women canadian viagra viagra tablets how does lexapro work viagra pill how long for azithromycin to take effect zithromax 500 mg azithromycin eye drops cialis daily azithromycin vs erythromycin viagra 50mg cialis cheap buy cialis viagra sans ordonnance finasteride 5mg side effects mayo clinic cipro for uti viagra single packs is azithromycin penicillin cialis generic tadalafil ciprofloxacin hcl 500 mg side effects azithromycine 250 mg finasteride permanent side effects free cialis tamoxifen langzeitfolgen lexapro weight gain cipro drug class azithromycin 5 day dose pack zovirax cream finasteride vs dutasteride cialis 30 day trial coupon lowest cialis prices propecia lexapro para que sirve viagra kaufen cost of viagra effects of stopping finasteride ciprofloxacin hcl 500 mg azithromycin side effects side effects lexapro viagra en ligne livraison 24h acyclovir dosing how to get off lexapro cialis coupon what is azithromycin used for cipro and tendonitis sex viagra for women cipro side effects lexapro cialis 20 mg acyclovir 400mg viagra pillen kruidvat what is acyclovir for cialis without a doctor’s prescription lexapro overdose generic viagra 100mg lexapro benefits for women post finasteride syndrome finasteride hair loss levitra coupons cipro antibiotics buy levitra online what is ciprofloxacin used for what is escitalopram 200 cialis coupon cipro dangers cialis dosage recommendations cialis copay card azithromycin cost cialis 30 day sample azithromycin for strep throat finasteride efectos secundarios side effects of ciprofloxacin ciprofloxacin side effects after age 60 celexa vs lexapro cialis tadalafil levitra erfahrungen ciprofloxacin hcl viagra sex tamoxifen side effects in women over 55 levitra what works better than viagra what is lexapro used for tamoxifen and foods to avoid viagra for men acyclovir 800 mg 5 times a day acyclovir dose nolvadex over the counter viagra viagra vs cialis vs levitra viagra tesco lexapro dosages cialis vs viagra what is azithromycin side effects of viagra finasteride medication generic cialis finasteride 1mg acyclovir for cold sores azithromycin class cialis coupons from manufacturer how does acyclovir work viagra dosage liquid cialis withdrawal from lexapro cialis alternative viagra receptfritt azithromycin 250mg lexapro withdrawal symptoms cialis pills side effects of lexapro levitra vs viagra how much does cialis cost what is acyclovir used for cialis 20mg directions azithromycin pediatric dosing lexapro 10 mg levitra coupon cialis from canada side effects of azithromycin what is viagra viagra 100mg tablets retail price acyclovir 800 mg for shingles where to buy viagra weaning off lexapro levitra vs viagra viagra online cialis vs viagra azithromycin escitalopram 20 mg viagra coupon finasteride 5mg escitalopram effets secondaires levitra 10 mg prezzo cialas ciprofloxacin hydrochloride ophthalmic female viagra what does ciprofloxacin 500mg treat levitra 20mg cialis price cialis for men what is cialis cialis patent expiration 2017 finasteride dosage ciprofloxacin 500 ciprofloxacin 250mg viagra pills ciprofloxacin 500mg tablets azithromycin for uti viagra generico viagra nebenwirkungen is tamoxifen chemotherapy cyalis finasteride and enlarged prostate lexapro 5mg cialis generic generic for lexapro viagra natural lexapro and weight loss viagra generic side effects of acyclovir antibiotic ciprofloxacin viagra medicine cialis dosage strengths acyclovir cream cialis 5mg ciprofloxacin spc is lexapro a controlled substance cialis for women tamoxifen and bone pain side effects of tamoxifen viagra alternative buy generic levitra revatio vs viagra what is cipro usually prescribed for how does cialis work how long for lexapro to work tamoxifen and weight gain ciprofloxacin ophthalmic solution ciprofloxacin ciprofloxacin hydrochloride cialis coupons printable lexapro bula acyclovir zithromax antibiotic cipro 500 viagra costs escitalopram side effects buy viagra ciprofloxacin for dogs lexapro side effects cialis coupons ciprofloxacin hcl 500 mg tab cialis effects cialis website side effects of azithromycin 250 mg lexapro dosage cialis 5mg daily ciprofloxacin dosage how to use viagra cialis discount acyclovir vs valacyclovir viagra vs cialis vs levitra lexapro vs zoloft is ciprofloxacin a penicillin cialis reviews finasteride for women side effects of cialis wholesale cialis azithromycin without a doctor’s prescription azithromycin 250mg tablets 6 pack is azithromycin viagra cost ciprofloxacin drug class ciprofloxacin nebenwirkungen side effects of lexapro 10 mg zovirax viagra vs cialis viagra samples finasteride 5mg tab cipro side effects in elderly cialis testimonials azithromycin tablets ciprofloxacin used for lexapro vs wellbutrin cialis for bph viagra on line lexapro side effects in women viagra lexapro dosing finasteride side effects escitalopram 10 mg generic for cialis azithromycin pregnancy category cialis patent expiration date extended tamoxifen lawsuits what is lexapro for what is lexapro cialis free trial azithromycin tablet cialis on line acyclovir 400 mg propecia side effects cialis or viagra viagra without a doctor prescription azithromycin dosage cialis coupons 2017 what does azithromycin treat price cialis lexapro for anxiety azithromycin 250 mg treatment cialis side effects what is ciprofloxacin prescribed for viagra 100mg what does ciprofloxacin treat cialis canadian pharmacy finasteride 5mg side effects lexapro side effects in men tamoxifen side effects acyclovir 800mg lexapro vs celexa sophia viagra azithromycin 250 pfizer viagra what is cipro acyclovir 200mg order viagra how to take cialis lexapro 20mg wellbutrin and lexapro zovirax dosage cialis voucher vardenafil 20mg buy levitra cipro uses finasteride side effects in men generic levitra what infections does ciprofloxacin treat natural viagra generic cialis at walmart what is azithromycin for online cialis cheap viagra ciprofloxacin eye drops levitra 20 mg von bayer lexapro reviews cialis 20mg cialis for daily use tamoxifen interaction buy generic viagra what is cipro used for online viagra lexapro generic name azithromycin for pneumonia cialis 5 mg discount viagra zovirax ointment ciprofloxacin drops zithromax dosage levitra 20 mg what is acyclovir what is finasteride used for ciprofloxacin 250 mg cialis cost acyclovir ointment 5 ciprofloxacin 500 mg for urinary tract infection what does viagra do cheap levitra viagra activate cialis canada side effects of ciprofloxacin 500 mg tamoxifen therapy what is ciprofloxacin when will cialis go generic daily cialis lexapro coupons levitra without a doctor prescription viagra ohne rezept aus deutschland ciprofloxacin 500 mg cialis prices finasteride reviews acyclovir medication acyclovir dosage for cold sores ciprofloxacin coverage buy viagra online tamoxifen citrate lexapro and weight gain in women azithromycin pregnancy ciprofloxacin class acyclovir ointment azithromycin uses what is finasteride thuoc azithromycin discount cialis cipro dosage cialis trial ciprofloxacin uses generic cialis tadalafil lexapro and wellbutrin combination therapy azithromycin 500 erfahrungen escitalopram 10 mg para que sirve zovirax pills canadian cialis common side effects of ciprofloxacin 500 mg escitalopram oxalate generic levitra vardenafil 20mg viagra 100 mg escitalopram 10mg ciprofloxacin dosierung generic viagra side effects of finasteride tamoxifen cost first few days on lexapro acyclovir side effects zithromax acyclovir dosage viagra for sale acyclovir 800 mg viagra wiki cipro side effects of finasteride 5mg azithromycin 500 mg finasteride for hair loss lexapro 10mg azithromycin and alcohol azithromycin medscape azithromycin 250 mg viamedic cialis levitra vs viagra for hardness viagra substitute lexapro and weight gain cialis for sale viagra for sale uk viagra bestellen viagra price effects of stopping lexapro suddenly viagra vs cialis cialis medication levitra dosage cialis pills for sale viagra 100 viagra side effects finasteride tablets ciprofloxacin 500mg what is tamoxifen used for what does finasteride do what is tamoxifen azithromycin coverage cialis patent expiration zovirax for cold sores does lexapro cause weight gain cialis pharmacy prices pfizer viagra coupons from pfizer utilisation viagra erectile dysfunction cialis escitalopram what bacteria does ciprofloxacin kill buying viagra azithromycine eg 500 mg bijsluiter azithromycin liquid canada cialis finasteride 5 mg tab cialis online ciprofloxacin 500mg antibiotics cost of cialis levitra bayer 20mg meilleur prix cialis sample ciprofloxacin bnf azithromycine viagra alternatives cialis otc canada viagra escitalopram nebenwirkungen vardenafil vs viagra ciprofloxacin dose cialis dosage free viagra generic lexapro levitra prezzo in farmacia azithromycin z pak levitra prices levitra generic lexapro side effects men viagra cialis finasteride levitra online best price viagra cialis 10 mg ciprofloxacin 500 mg tabletten finasteride effets secondaires ciprofloxacin 500mg antibiotics side effects azithromycin 500 levitra rezeptfrei deutschland viagra coupons cipro antibiotic finasteride results cialis coupon print lexapro manufacturer website azithromycin 500mg viagra soft zoloft vs lexapro tamoxifen side effects in women stopping lexapro buy cialis online viagra tablet tamoxifen nebenwirkungen cheap cialis