The silver market is on track for a sixth consecutive annual supply deficit in 2026, with analysts pointing to firm investment demand and unusual price volatility rather than a steady climb. The metal set records early in the year before a sharp correction reset expectations.
Silver breached the 100 dollar level for the first time in January 2026 and reached a record near 121.62 dollars per ounce, then fell roughly 35 percent from that peak as geopolitical and policy crosscurrents shook the market. Forecasts for the balance of the year diverge widely, with one analyst projecting a move above 175 dollars and UBS setting a more conservative year-end target near 80 dollars. The wide range reflects how sensitive the metal has become to investment flows.
Physical investment is forecast to rise about 20 percent to a three-year high near 227 million ounces, with Western buyers returning to coins, bars, and exchange-traded products. Tight physical supply in London, US policy uncertainty, and questions about Federal Reserve independence are cited as supporting factors. Mine supply is expected to edge up about 1 percent even as total global supply declines, which keeps the structural deficit in place. For US investors, the combination of record-setting moves and steep pullbacks defines the 2026 silver story.
Source: Kitco News - https://www.kitco.com/news/article/2026-04-15/silver-market-faces-another-deficit-2026-volatility-and-investment-demand