When I put all the available facts together, it’s hard for me to believe that the current silver price reflects reality.
Silver has been in a structural deficit for seven consecutive years. At the same time, exchange vault inventories are being depleted across the world. As of February 12, the Shanghai Futures Exchange holds only about 300 tonnes of silver, which represents weeks of consumption, not a meaningful reserve. In the West, registered inventories on COMEX are down to roughly 100 million ounces, a very small buffer for a global market of this size.
China has restricted silver exports, the United States has classified silver as a critical metal, and industry players are increasingly securing supply directly from miners. Companies like Samsung are locking in long-term off-take agreements to guarantee future production.
Despite all this, the price was aggressively pushed lower. That makes little economic sense to me. It only makes sense as a way to buy time — to shake out speculators, scare weak hands, reduce pressure on physical deliveries, and allow states and industry to secure metal at paper prices.
But this doesn’t solve the problem. It only postpones it. A low price in the face of real scarcity accelerates the drawdown of physical inventories and pushes even more demand off-exchange.
My conclusion is simple:
Yes, the price was pushed down to buy time. But time can only be bought until physical metal runs thin. When that happens, I don’t expect a slow, orderly rise — I expect a sharp and chaotic repricing higher, as the market is forced to reconnect price with physical reality.
That’s why I believe it’s important to stay calm, ignore the fear, and avoid selling under pressure. Short-term price moves don’t change the fundamentals — and the fundamentals have only grown tighter.
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