The company that brought you the iPod, iPhone, and iPad is now bringing you good news (if you own silver). According to several trends, including some reported from Apple, silver may double in value in the coming year. Let’s take a look at some of the reasons why this may happen.
Silver is found in many devices, including those produced by Apple. This is one of the reasons many people like to invest in silver – because of its practical uses which create demand. Last January, Apple had to display the launch of its 27-inch iMac due to a shortage in industrial silver in China. The high demand in the first indicator that silver’s price may be on the move.
Another reason is the high sales figures for silver. In 2013, the price of silver fell from $32 in February to $18.50 in June, and buyers responded. Demand was high for the physical precious metal on the heels of the drastically reduced price. So high, in fact, that the US Mint had many silver sales records broken, including the most American silver Eagles sold in the first quarter and throughout the year.
Speaking of demand, silver demand from India continues to surge. Earlier this year, the Indian government made gold imports more expensive, and because of its lower price, many consumers are buying silver instead. India is pacing to set a new record for silver imports in 2013; the country now imports nearly 45% of all mined silver around the world for investment purchases.
Lastly, silver is currently priced below cost. Silver producers have been able to cut costs by 13%, and their cost to produce an ounce of silver is about $20.08. However, the current price is around $19.50. So currently, it costs more to produce silver than to purchase it, which will most likely be corrected by increasing the price for silver in the coming year.
Given the strong demand for physical silver from consumers, countries like India, and companies like Apple, combined with the incredibly low price to purchase physical silver, you have to wonder how long it will last before the prices go up to the same levels as the demand and production costs. Common sense tells us that silver prices have a lot of upside in the short term, though as with anything involving future trends, no one can say for sure. Based on these facts, however, physical silver looks like a great buy.