Keith Neumeyer, CEO of First Majestic Silver, a renowned Canada-based mining company, recently delved into the silver production deficit within today’s precious metals markets. Neumeyer highlighted the growing interest from retail investors in silver and emphasized the crucial role institutions must play in supporting extractive companies catering to various industrial needs.
Insights on the Potential Surge in Silver Prices with Institutional Participation
In light of the recent surge in gold prices, the spotlight has now turned towards silver as a promising investment option for retail investors. Neumeyer, in a candid discussion, shed light on the current state of the silver market, suggesting that its true value should hover around $70 per ounce. The industry expert pointed out a looming deficit of approximately 240 million ounces in the silver market, indicating a potential supply crunch on the horizon.
According to Neumeyer, the discrepancy in silver prices can be attributed to two key factors. Firstly, he discussed the impact of price manipulation by traders who view silver purely as a tradable asset without recognizing its intrinsic value for industrial applications. These traders often overlook the industrial significance of silver, leading to skewed price perceptions.
Secondly, Neumeyer highlighted the conspicuous absence of institutional interest and investment in the silver market. Despite the active participation of retail investors, the lack of institutional support poses a notable challenge for extractive companies reliant on silver production. Neumeyer emphasized the critical role institutions should play in bolstering the sector to meet the growing demand for industrial purposes.
In a similar vein, industry analysts like Peter Schiff have also projected a significant uptick in silver prices, with predictions suggesting that $50 could soon become the baseline. This optimistic outlook underscores the robust performance of silver as a precious metal and hints at the possibility of even higher price increments in the near future.
