China used to be a silver exporter based on its being one of the world’s top three silver producers….. now China has become the major importer of silver Of much interest to silver investors looking to the long term almost 70% of the silver imported by China is used in manufacturing.
USGS 2011: As can be seen above Peru, Mexico and China were the top three producers…. Silver was obtained as a primary product from mines in Mexico, Peru, and Australia, in descending order of production.
Silver was also obtained as a byproduct from lead-zinc mines, copper mines, and gold mines, in descending order of production. The polymetallic ore deposits from which silver is recovered account for more than two-thirds of U.S. and world resources of silver. Most recent silver discoveries have been associated with gold occurrences; however, copper and lead-zinc occurrences that contain byproduct silver will continue to account for a significant share of future reserves and resources.
I think this bodes well for the long term silver investors as most silver is produced as a by-product of zinc/lead/gold mining and primary silver mines are relatively few as pure silver deposits aren’t abundant.
Even though Chinese silver mining witnesses significant growth and development in recent years, fueled by technological strides in exploration and an increase in production in response to steady growth in domestic and international demand China is a major global producer and consumer of silver-based brazing alloys. China has some of the world’s largest manufacturing facilities for home electronics and electrical appliances, which utilize various type of silver-based solder. China is the world’s largest producer of solar power and electronics.
Silver demand in China is soaring thanks to increasing use for industrial and jewelery purposes.
About 70% of China’s silver demand comes from the industrial sectors.
Silver is widely used in the China is the third largest producer of mined silver in the world.
China is the third largest producer of mined silver in the world.
China is top consumer of silver in the world.
Albanian_Minerals President Sahit_Muja said “Silver demand has witness a significant growth in 5 years, fueled by steady growth of silver use” http://www.pr-inside.com/china-s-net-imports-of-silver-hit-r2590259.htm Albanian_Minerals
Over the next few days I will have finished analysing Australia’s silver producers and will publish the data on www.australian-shares.com. My preliminary impression is that there are a couple of outstanding silver investments listed on our ASX.
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As was widely rumored IAU’s resource upgrade announcement was remarkable and has almost doubled the porphyry copper-gold resource at its Tujuh Bukit project to nearly 1 billion tonnes.
Granted the grades are very low…. but even then under usual circumstances such a large upgrade should have seen a far greater share market response…. makes me think that others share my concern re the forestry legislation… however some quite clever people are telling me that Indonesia wouldn’t take the chance of rattling market confidence by blocking this project.
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In an earlier post I was very positive about IAU however after reading through today’s announcement I’m less pleased…. the big worry for me is that the door seems to be wide open for the Indonesian Govt. to block the mining of the resource as the resource isn’t currently able to be open pit mined as it is in a designated “Forest area” where open pit mining is forbidden. As the resource is low grade (albeit most likely massive) the economics look dodgy for an underground mine….
But have a read of today’s announcement “MANAGEMENT’S DISCUSSION AND ANALYSIS” and tell me what you think.
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Last week I was asked about a company that had pegged some land near Mt Weld… I looked through the company’s reports and found that they were indeed right next door to Mt Weld’s ore body…. but have a read of the story excerpted below:
“THE story of the Great International Quartz Mining Company is remarkable, writes ANDREW MOLE
Outside Maldon, in the 1880s, the North British Mine produced 203,000 ounces of gold.
In today’s speak, that’s roughly $296 million.
Just a stone’s throw down the gully, within sight of each other, the Great International Quartz Mining Company extracted a miniscule 33 ounces.
But only after two years of back-breaking labour, hand-drilling more than 500 metres through nothing but solid rock.
In today’s speak that’s roughly $48,114.”
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The story below points strongly to China’s emerging/strengthening distrust of the US$ and US Debt…..
‘New funds considered’ to protect reserves
By Hu Yuanyuan
Published: Apr 26 2011 8:36
BEIJING — The central bank is planning new investment funds to diversify holdings in the nation’s $3 trillion foreign exchange reserves, to hedge against depreciation and inflation risks, according to a news report.
The proposed funds will invest some of the foreign reserves in energy and precious metal markets, the New Century Weekly said on Monday, citing unnamed sources close to the People’s Bank of China.
However, the report did not disclose the size of the proposed funds, their operation methods or the timing of their possible launch. The central bank was not available for comment.
Foreign exchange reserves jumped by $197 billion to $3.04 trillion in the first quarter, marking the second-biggest increase on record, central bank statistics show.
That fueled concern over devaluation risks and over-exposure to US debt.
“This is a positive way to diversify investment risk, especially as China holds such large amounts of US debt,” Xu Hongcai, a finance professor at the China Center for International Economic Exchanges, told China Daily.
While China has been slashing its US debt holdings since October, it still remains the largest creditor. At the end of February, China held $1.15 trillion of US debt, down $600 million from the previous month.
US debt, once considered gilt-edged, is becoming increasingly risky.
Credit agency Standard and Poor’s downgraded America’s credit outlook in April from stable to negative for the first time in history, implying that the US has been put on notice that it faces losing its AAA credit rating unless it gets on top of its yawning debt and deficit.
Earlier this month, Zhou Xiaochuan, the central bank governor, said China’s foreign exchange reserves had exceeded a “reasonable” level and the management and diversification of the holdings should be improved.
The central bank’s plan to set up new funds will diversify risk by creating new investment bodies, said Xu.
Currently, China Investment Corp (CIC), the country’s sovereign wealth fund, is mainly responsible for the overseas investment of China’s swelling foreign reserves. Established in 2007, CIC is now waiting for a capital boost plan from the State Council.
Diversifying reserves through investment agencies, such as CIC, is a possibility, Zhou said on April 18, after a speech at Tsinghua University, and also highlighted a possible option.
“One option is to consider some new types of investment agencies which focus on new investment areas.”
Xu said he believes another way to reduce risk to the foreign exchange reserves is to transfer some funds to commercial banks as long- and medium-term time deposits, so private enterprises can get them when exploring overseas markets.
“That should be a win-win deal, as the central bank can also secure a yield higher than US debt,” said Xu.
According to the New Century Weekly, the central bank is also considering a fund that could intervene in the foreign exchange market to stabilize exchange rates on behalf of the central bank.
The growth in foreign exchange reserves may affect efforts to curb inflation.
Yi Gang, deputy governor of the central bank and head of the State Administration of Foreign Exchange, said earlier that to keep the exchange rate stable the central bank had to roll out nearly 20 trillion yuan ($3.04 trillion) last year, thereby fueling inflation.
The Wall St Journal’s take on the above story
And another just published in the Financial Times
Which viewpoint you favor the outlook for Australia’s resource sector gets brighter by the minute
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Gold and Silver Prices Continue to Rise; Money Invest News Spot Gold and Spot …
Learning and Finance
Once again contract gold flirted with the psychological threshold on Thursday before finally holding on to the higher price per ounce rate to finish. Precious metal gold closed over the mark for the first time to close the week. Gold and silver prices …
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Canadians cashing in old coins to profit from soaring silver prices
CanadianBusiness.com
Silver is up more than 60 per cent from the lows of late January and is within sight of the record selling price of $50.36 set in 1980. Many analysts expect the price will surpass $50 and may not quickly collapse as it did 31 years ago when the price …
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Why Silver Prices Won’t Quit
TheStreet.com (blog)
By Alix Steel 04/22/11 – 08:00 AM EDT NEW YORK (TheStreet) — Silver prices are up 49% in 2011. Day after day the metal keeps hitting new 31-year records. Traders keep waiting for some kind of fierce and furious correction, but so far silver keeps …
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Soaring gold, silver prices linked to weaker dollar
Daily Times
ISLAMABAD: The Pakistan Economy Watch (PEW) on Thursday said unprecedented hike in gold and silver prices suggests that investors have lost some faith in weaker US dollar. “The development also hints at lack of confidence among investors in America’s …
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One “Combination” To Unlock the “Safe” of Gold and Silver’s Price Trends
Elliott Wave
Often times, it can feel like there’s a ticking time bomb of volatility super-glued to the “safe” of gold and silver’s price trends. If you don’t crack the code fast enough, the opportunity to position for near-term turns blows up in your face. …
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The Squeeze is On! Silver Continues Its Climb (SLV, UDN, JPM, HSBC)
Benzinga
For example, over the past 12 months, the price of silver has risen 157.8% while gold prices have only risen 31%. The idea of someone trying to corner the market is not as farfetched as it may seem. After all, the silver market is much smaller in size …
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Silver to continue its run but next big move to belong to gold – RBC
Mineweb
That said, the bank does have some “medium- to longer-term concerns due to increasing primary silver mine supply, which we believe could eventually cap the upside for silver prices.” According to RBCCM, primary silver production is expected to increase …
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Silver Shines Near Old Record
PBS Nightly Business Report
Silver prices rose sharply again, up $1.60 to $46 and change per ounce. That`s the highest price in a generation. GHARIB: The run-up in silver has been spectacular. Prices have more than doubled in the past year alone. Suzanne Pratt takes a look at …
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“Talisman Mining Ltd (ASX: TLM) is pleased to advise that the drilling of a single deep diamond drill hole (approximately 1,500 metres) has now commenced at its 100% owned Shelby Project in Western Australia.
The Shelby Project is located on the northern margin of the Bryah Basin approximately 30km north of the Horseshoe Lights Copper-Gold Mine (see Figure 1).
The total project area covers an approximate 100km strike length of a major structural corridor.
Evaluation of recently collected airborne magnetic data indicates excellent potential for large intrusive bodies either of mafic-ultramafic or granitic affinity that have the potential to host a range of deposit types including mafic-ultramafic intrusive related nickel-copper deposits (e.g. Voisey’s Bay (Vale), West Musgrave (BHPB)) and/or Iron Oxide Copper Gold (IOCG) deposits (e.g. Olympic Dam (BHBP))
Talisman plans to test this concept by drilling a 1,500 metre diamond drill hole into a large modelled magnetic target at Shelby (see Figure 2) and has been granted co-funding of up to $200,000 under the WA State Government Exploration Incentive Scheme (EIS).
Examination of open file records by Talisman found that BHPB had drilled a single 520 metre diamond hole to test this target in 1996. The single drill hole intersected highly altered mafic-ultramafic lithologies at approximately 450 metres further supporting the concept for the potential existence of a large intrusive mafic-ultramafic body with the potential to host magmatic nickel-copper sulphides.
The deep drill hole and associated programs of down-hole geophysics is anticipated to take approximately 6 weeks to complete.”
BULLSEYE?
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