Silver supply projected to stay in deficit position

New silver supplies are projected to fall short of fabrication demand again this year, with the deficit narrowing slightly to about 190.4 mil- lion oz.

That is the word from research company CPM Group of New York, which recently published its Silver Survey 1995.

Fabrication demand has exceeded total new supply during the past five years. The total new supply of silver declined 1% in 1994 to 469.8 million oz., the second consecutive year in which total supply decreased (it peaked in 1992 at 501.7 million oz.). The decline reflects lower mine production. For 1995, total supply is projected to climb to 496 million oz. Mine production totalled 322.7 million oz. in 1994, off 3.4% from the previous year. Canadian silver production was off sharply because of lower output at primary silver mines and at lead, zinc and copper mines where the metal is recovered as a byproduct. Silver output in the U.S. also dropped. In Mexico, the largest silver-producing nation, output rose to 65 million from 61 million oz. in 1993. Peruvian production increased to 48 million from 47 million oz.

Secondary recovery of silver from scrap and old coins, and other supplies including silver exported from the transitional economies of eastern Europe and Asia and government inventory disposals, rose 4.6% in 1994 to 147.1 million oz.

Fabrication demand rose 3.9% last year to 665.5 million oz. Silver use in jewelry and silverware (the largest end-use industry) declined last year for the first time since 1984; in particular, lower consumption was reported in India.