The most overlooked energy mineral of them all.
There is a lot of buzz about the fortunes to be made on “battery metals.” That is with good reason, as the accelerating global adoption of large-battery electric vehicles makes headlines every day.
But this is not just about cars, batteries, or metals. We’re witnessing a worldwide energy paradigm shift.
The raw materials that will see soaring demand include the metals making investment headlines, like lithium and cobalt, but also nonmetallic minerals like graphite. And their use in batteries is only half the story. The other half is in the solar, wind, and other “green” energy sources that are getting cheap enough to start competing with oil. For example, wind turbines require rare earth elements for their high-performance magnets.
The most overlooked energy mineral of them all, however, is silver.
Whether it is cheap solar panels from China or a high-end Tesla solar roof, all commercial solar panels on the market today use substantial amounts of silver. The average 1.8-square-meter solar panel includes about 20 grams of silver as an essential layer in its photovoltaic surfaces. The math works out to just over a kilo of silver per 1,000 square feet of solar panels.
For those who look forward to driving their electric roadsters around “for free,” silver is just as vital as lithium or cobalt.
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And yet, most people think of silver as a precious metal—the poor man’s gold—part of a completely different market. And that is true. Silver prices move within a variable range around gold prices, which are subject to safe-haven demand more than industrial demand. There’s no question about this.
On the other hand, silver is largely consumed as an industrial metal rather than vaulted as a precious metal. Film and paper photography used to consume the lion’s share of the world’s silver output. Now it’s electronics, medical, and increasingly, photovoltaics.
This sets up a unique situation for silver. It is produced as a byproduct, mostly of copper and gold mines. Even the richest silver-primary mines in the world are really lead and/or zinc mines with high-grade silver in the mix. What happens if demand for these other metals (which are not used in solar panels) were to drop at the same time as demand for silver increased?
There could be a real supply crunch, causing silver prices to break out and race ahead at a far faster rate than gold prices.
But we don’t need this to happen in order to see much higher silver prices. Precious metals are already trending higher, and I expect that trend to continue. I think 2019 could be a breakout year for both silver and gold, but that is a topic for another day. Today, safe-haven demand is already pushing precious metals prices higher, even as industrial demand for silver increases. That is very bullish for silver.
What about new solar panels that use less silver? Obviously, manufacturers have a strong incentive to reduce the amount of silver in their panels as much as they can. They’ve already made progress in this regard, and are likely to continue. I hear of designs that use half as much silver, some just a quarter. I expect these to come to market in time.
That is good news for silver.
It means that the cost of going solar will keep getting cheaper. And that means that more and more people will adopt it. It’s easy for people all around the world to see the advantages of getting their power for free from the sun. What held them back has been the cost and the lack of good storage for when the sun isn’t shining. The storage is now a solved problem. And the falling costs will tip the scales for more and more people to go solar.
This is an idea whose time has come. It’s not going to spread slowly, by a few percentage points every year. As the key tipping points are reached, we’re going to see massive moves—a paradigm shift—into “free” energy. The scale of the increased demand should more than offset the decreased amount of silver per panel.
“Green” may be nice, but “free” is something everyone wants.
I am personally looking in to the best ways to speculate on silver today. You can join me in that quest via www.IndependentSpeculator.com, or you can do your own research.
Either way, I urge you not to overlook this essential—if often misunderstood—energy mineral.
Note from the Publisher: Lobo Tiggre has recently launched his own subscription-based program called The Independent Speculator, which advertises “Actionable Investment Ideas for Exceptional Results. Start benefitting from powerful, thoroughly researched, unbiased investment insights today.” that I personally love — to subscribe, click here
Lobo Tiggre is the founder and CEO of Louis James LLC, and the principal analyst and editor of IndependentSpeculator.com. He researched and recommended speculative opportunities ... <Read more about Lobo Tiggre>