![]() ![]() Total secondary recycling of silver doubled, from 152.0 million ounces in 1978 to 302.0 million ounces in 1980. The bulk of this increase occurred in secondary recovery. Total supply rose form 434.8 million ounces in 1978 to 505.0 million ounces in 1979, and then to 584.6 million ounces in 1980. These high silver prices meanwhile were having an effect on the physical silver market conditions. By the end of 1980 silver prices had subsided once more to around $16.00. Prices dropped as low as $10.80 in March, but rose back to $25.00 in September, as the Iran-Iraq war erupted. High inflation, high nominal interest rates, and negative real interest rates further stimulated investor interest in silver and other tangible assets. hostage crisis in Iran and the Soviet invasion of Afghanistan, motivated investment demand, helping keep silver prices high and volatile through 1980. Other sold large amounts of sterlingware and jewelry for its silver content.Ī host of political events, including the continuous U.S. Investors began to sell large amounts of silver especially old coins from the 1960s. Demand also quickly declined for jewelry and sterlingware. When silver rose to $15.00 and more however, fabricators were able to introduce these measures rapidly. Several substitutes for silver and methods to reduce per-unit silver use were developed, but they were too expensive to implement as long as silver was around $5.00 per ounce. When silver prices rose sharply in 1973-1974, manufacturers began searching for ways to reduce their need to use silver. By some estimates, industrial use of silver was 40% lower in the last quarter of 1979 than it had been in the first quarter of that year. However, a sharp cut-back in demand in the fourth quarter led to overall annual decreases in silver use. Demand had held up reasonably well during the first three quarters of the year. On an annual average basis, industrial silver use fell a relatively mild 0.9% to 445.1 million ounces in 1979. Silver prices ultimately fell to below $11 an ounce two months later.Īs silver prices rose above $15.00 in September 1979, fabrication demand began to be affected. ![]() During the Hunt brothers’ accumulation of the silver, prices of silver bullion rose from $11 an ounce in September 1979 to $49.45 an ounce in January 1980 based on London PM Fix. futures exchanges that traded silver at the time took steps to force those with margined long positions to liquidate their positions. At these levels several physical market forces combined to act against higher prices. Simplistic retrospectives of the silver market in late 1979 tend to focus on the high-profile purchases of large amounts of silver and silver futures by various wealthy individuals in reality, there was a tremendously broad-based rush to buy silver by investors worldwide at the time.īy the final quarter of 1979, silver prices had risen to levels between $15.00 and $25.00 per ounce. This added further upward pressure to the price of silver. Investors ceased selling their old silver holdings, and instead began adding to their holdings. ![]() Sensing that silver prices should be adjusting upward to compensate for these inflationary trends, many investors decided that silver prices between $4.00 and $5.50, which had prevailed during most of the late 1970s, were too low. ![]() World economic and political events also were coming to bear on the silver market, most notably in the form of a major cyclical upward surge in inflation throughout the industrialized world. Prices had risen from the beginning of the decade, but there were serious questions as to how much longer investors would be willing and able to continue supplying silver to fabricators, at least at the prices seen in the mid-1970s. The market had been living off of investor selling for seven years. (yearly average prices based on London PM Fix)īy 1979, investors and other market participants had come to the strong conviction that the silver market was facing a severe shortage of metal, and that prices were likely to rise sharply at some point. How our Silver Mining and Refining Companies Operate Responsibly.Member Company Sustainability Reporting & Information. ![]()
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