Gold Digger: silver will be ‘turbo-charged version of gold’, Goldman Sachs says
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Silver’s solid bull case has nothing to do with #silversqueeze, which was a load of nonsense.
Big banks and hedge funds do not have massive, short positions in the silver market to suppress the price of the precious metal.
Which means there is no opportunity to force a ‘short-squeeze’ GameStop-style and generate extraordinary gains.
But such efforts still have an obvious, short-lived impact on precious metals prices, Metals Focus says.
The silver price briefly touched $US30/oz on Thursday – an eight-year high – before falling back to $US27/oz.
“As the past few days have illustrated, concentrated investor buying can certainly fuel strong rallies,” the research consultancy says.
“These, however, are likely to be short-lived, in the absence of more structural bullish factors.
“[But] in the current environment, given an already bullish silver outlook, Reddit-type investor campaigns could bring forward the forthcoming rally.”
This imminent rally could be helped along by booming industrial demand. Silver is used in solar cells (PV) as a conductor of heat and electricity.
From 2020 through 2030, the PV sector is expected to consume a cumulative 888 million ounces of silver — equivalent to an average of 81 million ounces per year.
Current annual global silver production is just under 1 billion ounces per year.
That’s why Jeffrey Currie, global head of commodities research at Goldman Sachs, favours silver over gold as an investment in precious metals.
“I like to say that it’s a turbo-charged version of gold,” Currie says.
“That’s what silver has that gold doesn’t have: It goes into solar panels.”
Here’s how 187 ASX-listed gold/silver stocks performed over the past week:
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WA explorer Nelson hit the golden motherlode near Kalgoorlie?
A first ever diamond drilling program at the Woodline project’s Redmill, Grindall and Socrates prospects is due for completion this month.
“Work carried out by Nelson at Socrates has returned several significant gold intersections, suggestive of a large gold system,” Nelson said in January.
“The company believes that Grindall, Redmill, and Harvey each have the potential to host a Tropicana scale gold deposit.”
Thomson is close to wrapping up its acquisition of the previously producing Webbs and Conrad silver projects in NSW.
The high-grade Webbs deposit produced ~55,000t of ore grading at least 23oz (about 710 grams per tonne) silver between 1884 to 1901.
Conrad was historically one of the largest silver mines in the New England region, producing about 3.5moz of silver along with lead and tin.
The explorer’s shares rose after it announced new high-grade copper-silver targets had been identified at its Khusib Springs mine in the southern African country of Namibia.
The project was a copper-silver mine from which 300,000 tonnes of ore grading 10 per cent copper, 1.8 per cent lead and 584 g/t silver was mined up until 2003.
A study identified remnant zones of copper-silver mineralisation on the margins of mined slopes as well as at depth, it said.
The first hole at the high-priority Cosmopolitan prospect has intersected visible gold:
Cosmopolitan had produced about 360,000oz of gold at an average grade of nearly 15g/t – well above the 5g/t that is generally considered to be high-grade – between 1896 and 1922.
Managing director Jason Livingstone says visible gold is always exciting when drilling and is a “phenomenal” way to start the year’s exploration, though he cautioned that assays would be needed to really quantify the actual gold content.