FACTS ‘N’ FIGURES — World can’t get enough silver

Silver demand was robust in 1997, exceeding supply from mine production and scrap recycling by 198 million oz. and effecting substantial reductions in bullion stocks, according a report released by Washington, D.C.-based Silver Institute.

Strong fabrication demand from India and the United States resulted in a record offtake of 863.4 million oz. in 1997, an increase of 6.1% over 1996, states World Silver Survey 1998. Increases in mine supply and scrap recycling could not keep pace with fabrication demand, which jumped 49 million oz. last year. The three countries that consumed the most silver in fabrication were the United States, with 167 million oz.; India, with 131 million oz.; and Japan, with 127.2 million oz.

The fabrication end-user with the most growth in 1997 was the industrial sector (including batteries, catalysts, electrical and electronic products, and electrodeposition), which consumed 323.5 million oz. silver, an increase of 7.4%. The rise is attributable, in part, to increased demand for electrical and electronic products. In the United States, the sector consumed 70 million oz, in Japan, 59.4 million oz., and in India, 35.2 million oz.

The use of silver in jewelry and silverware rose to 280.2 million oz. in 1997, an increase of 5.3%. India was the largest consumer of silver used for these purposes, importing 95.2 million oz., followed by Italy, at 44.8 million oz.

The use of the metal in the photographic sector rose to 232.3 million oz.

Film and paper manufactures have increased production to meet fast-growing consumer and x-ray demands. The United States is the largest manufacturer and consumer of photographic products, but the fastest-growing areas of demand are in the developing world.

Worldwide silver production reached 512.6 million oz. in 1997, a 4.8% increase over 1996. Primary silver mines churned out 22% of the total, with the remaining 78% produced as a byproduct of base metal and gold operations.

Of the fifteen countries that produced 94% of the world’s silver last year, Mexico led the way with 86.2 million oz., followed by Peru, with 67 million oz. The United States was third, having produced 53.3 million oz.

Recycled scrap accounted for 18% of supply last year, increasing marginally over 1996 to 152.5 million oz. The United States was the largest recycler at 43.6 million oz., followed by Japan at 27.8 million oz.