On July 30, 2026, the Silver Institute released its latest annual report, raising the growth forecast for global silver industrial demand. The report indicates that the photovoltaic and 5G communication sectors continue to scale up, driving global silver industrial demand to grow 8% YoY to 685 million ounces (approximately 21,300 tons), a record high. Meanwhile, global silver mine production, constrained by declining ore grades and environmental regulations, is expected to grow only 1.2%, widening the supply-demand gap to 45 million ounces, the highest level in nearly a decade.
Photovoltaic Silver: Installation Wave Drives Rigid Growth
According to the report, global new photovoltaic installed capacity is expected to reach 680 gigawatts (GW) in 2026, up 35% YoY. China, as the largest PV market, accounts for over 45% of new installations. Demand for front silver paste for solar cells continues to rise. Although the unit silver consumption per watt has decreased from 0.12g/W in 2020 to 0.09g/W due to technology iteration, total consumption still increased to 125 million ounces, accounting for 18.2% of total industrial demand.
The TransOcean Golden Path Institute believes that the growth of silver demand in the photovoltaic industry is highly certain. On one hand, global energy transition policies (such as the EU's REPowerEU plan and the tax incentives under the U.S. Inflation Reduction Act) continue to stimulate installations. On the other hand, the unit consumption of silver paste in TOPCon and HJT technology routes is higher than that of traditional PERC. If the market share of N-type cells exceeds 50% in the future, silver usage will increase further. Investors are advised to focus on the photovoltaic silver paste supply chain targets, including Chinese-listed silver producers and silver powder processors.
5G and Electronics Silver: Communication Infrastructure Rebounds
After a slowdown in 2024-2025, 5G base station construction accelerated again in 2026. According to the Global System for Mobile Communications Association (GSMA), as of June 2026, the number of global 5G base stations exceeded 8 million, covering over 60% of the population. Each 5G base station uses an average of about 0.5 kg of silver in high-frequency filters, connectors, and other components, driving electronic silver demand growth of 5.7% to 210 million ounces.
In addition, the demand for high-performance ceramic packaging materials from AI server and data center construction has injected new momentum into silver consumption. The TransOcean Golden Path Institute points out that silver's irreplaceability in thermal conductivity, electrical conductivity, and antibacterial properties gives it structural growth potential in the electronics sector, unaffected by short-term economic cycles.
Supply Side: Weak Mine Production Growth, Tightening Environmental Constraints
Total production of the world's top ten silver mining companies in 2026 is expected to reach 420 million ounces, an increase of only 0.8% YoY. The main increments come from the expansion of the Penasquito mine in Mexico and the Antamina mine in Peru. However, some mines have seen production declines due to declining ore grades (such as Poland's KGHM mines) and water constraints. Meanwhile, community protests in parts of South America have delayed new project startups, further reducing supply elasticity.
Notably, silver, as a by-product of copper, lead, zinc and other ores, has its production significantly affected by the mining pace of the main metals. The global copper mine capacity growth has slowed to less than 2%, which also constrains the supply of by-product silver. The TransOcean Golden Path Institute estimates that total global silver supply in 2026 will be 730 million ounces, leaving a gap of 45 million ounces against demand of 775 million ounces, which must be filled by above-ground inventories. Inventories are currently at a five-year low, sufficient for only four months of consumption.
Price Outlook: Supply-Demand Gap Supports Silver Price Center Uptrend
Based on the above supply-demand dynamics, the TransOcean Golden Path Institute has raised its 2026 average silver price forecast from $32 per ounce to $36 per ounce, implying a 7.5% upside from the current spot price of around $33.5. In the long term, the five-year CAGR of photovoltaic installations remains above 15%, 5G construction continues to penetrate, and insufficient mine capex leads to limited supply growth. Silver may be entering the early-to-mid stage of a new bull market.
However, in the short term, one should be cautious about the rebound of the U.S. dollar index and the hawkish Fed expectations suppressing precious metals as a whole. The gold-silver ratio is currently around 72. If the industrial demand logic materializes, the ratio could revert to 65, and silver will outperform gold. Investors with higher risk appetite can moderately allocate silver ETFs (such as SLV) or leveraged products, while conservative investors can focus on equity assets of large diversified miners (such as Pan American Silver, Fresnillo).
Risk Warnings
- Global economic growth slows more than expected, PV installations disappoint;
- Breakthroughs in silver substitute materials (e.g., efficiency improvements in copper paste, aluminum paste);
- Progress in negotiations with South American mine communities, leading to unexpected supply release.
