Silver, often nicknamed the “devil’s metal” due to its volatility, has hit record highs this year and still has a way to go despite a supply crunch, experts say.
The metal’s growth value has coincided with that of gold, which has seen its own rally with the price surpassing $4,000 an ounce this year.
Silver prices reached an all-time high of $54.47 per troy ounce in mid-October, an increase of 71% year-over-year. They have since reduced their gains somewhat, but are growing again, despite low supply levels.
“Some people were having to fly the silver in rather than on cargo ships to meet delivery demand,” Paul Syms, head of EMEA ETF fixed income and commodities management at Invesco, told CNBC.
“Even though we saw an uptick, we saw the price fall a bit. Longer term, there is a different dynamic this time that could keep silver reasonably high and perhaps continue to rise for a while longer,” he added.
October was only the third time in the last 50 years that silver prices peaked. Other silver price peaks include January 1980, when the Hunt brothers amassed a third of the world’s supply as they attempted to corner the market, as well as 2011, following the US debt ceiling crisis, when silver and gold were adopted as safe havens.
Silver prices year to date
“Silver is only about a tenth the size of the gold market, and this short selling obviously surprised a few investors,” Syms said.
Unlike previous investment waves, the 2025 silver boom was based on a combination of low supply and high demand from India, as well as industrial needs and tariffs.
“After Liberation Day, the price of gold went up, but silver actually went down a little bit. And the gold-to-silver ratio went up above 100,” Syms said, referring to the gold-to-silver ratio that reflects the number of ounces of silver needed to buy one ounce of gold.
A low ratio means that gold is relatively cheap, while a high ratio indicates that silver is undervalued and likely to rise. In April, the ratio reached an all-time high.
“Risk managers from financial and industrial entities did not want to let any metal leave the United States for fear that it could return at a price 35% higher for example,” said Rhona O’Connell, head of EMEA and Asia market analysis at Stone X.
Fast forward to fall and silver has reached its peak, especially at the end of the monsoon and harvest seasons in India.
“Farmers don’t really like banks, so gold, and more recently silver, tends to be the first port of call when they bring in the harvest,” O’Connell said.
India is also the world’s largest consumer of silver, with around 4,000 tonnes used each year, mainly for jewelry, utensils and ornaments.
The cash delivery this fall also coincided with Diwali, a five-day “festival of lights” celebrating prosperity and good fortune and also India’s largest public holiday.
Supply crisis
While gold is traditionally a favorite, this year silver – an affordable investment option in a country where around 55% of the population depends on agriculture for their livelihood – has eclipsed other metals.
On October 17, the price of silver in India rose sharply, reaching a record high of 170,415 rupees per kilogram, an increase of 85% since the beginning of the year.
However, 80% of India’s silver supply is imported. The UAE and China are increasingly supporting this demand, but the UK has traditionally been India’s largest supplier of silver.
However, London’s coffers have been emptying rapidly in recent years. As of June 2022, the London Bullion Market Association held 31,023 tonnes of silver. By March 2025, volumes had fallen by around a third, to 22,126 tonnes, their lowest level in years.
“What’s not necessarily visible to people is what’s going on in the vaults,” O’Connell said. “And it had reached a point where there was virtually no metal available in London.”
By October, the crisis was such that traders had to pay much higher borrowing costs – or rental rates – to close their positions.
“At one point, borrowing overnight was 200% on an annualized basis, so a lot of people were very stressed, to put it mildly,” O’Connell said.
Supply is an ongoing issue for silver, as it is for other precious and rare metals. The Silver Institute’s World Silver Survey 2025 estimates that mining production has declined over the past 10 years, particularly in Central and South America.
“Over the past 12 months, the underlying surplus has started to turn into a deficit for three reasons: the impact of the electrification of the vehicle fleet, artificial intelligence and photovoltaics,” Mr O’Connell said.
“Right now a standard electric vehicle has about 25 grams of silver, maybe larger electric vehicles have 50 grams of silver in their components,” Syms said.
“If we move to these solid silver batteries, each electric vehicle could require a kilo or more of silver,” he added.
And as silver has high thermal conductivity and higher electrical conductivity than other metals, along with growing demand for electric vehicles, AI, and renewable energy, the metal’s value will likely continue to shine.
“Silver crosses that bridge between precious and industrial metals, and the way technology is evolving, batteries, solar panels, provide great use cases as we move toward a more electrified world,” Syms said.
