However, when the data was finally collected, it turned out that physical silver investment was the leading growth sector in the silver market in 2018… by a large degree. And, we can thank super-strong Indian silver demand for pushing physical investment to double-digit growth instead of a substantial decline.

Now, if we look at the information released by the Silver Institute back in November 2018 (Silver Interim Report), it stated that silver coin and bar demand was estimated to drop by 12% in 2018:

Bar and coin demand will be the main driver behind the fall contracting another 12.2% to 124.8 Moz in 2018. New physical coin demand has remained under pressure this year, particularly in the United States during the first half of the year, as investors relied on the secondary market with older dated coins for their investment needs. Physical bar and coin demand in other regions has also been disappointing this year, contracting mainly in the single digits as investors remained on the sidelines awaiting higher price volatility.

The folks at GFMS, who are now apart of the Refinitiv Company, forecasted last year that silver bar and coin demand would fall by 12%, followed by a 1.8% drop of Industrial demand and 0.6% reduction in jewelry and silverware:

Thus, overall global silver demand was expected to decline by 3% in 2018, mainly due to the large drop in coin and bar purchases. However, when the report came out just a few days ago, silver coin and bar demand surged by 20%. Investors purchased a stunning 181.2 million oz (Moz) of coin and bar, 45% higher than the 124.8 Moz forecasted in November last year:

If we look at both charts, the GFMS analysts were spot on with Industrial silver demand. Industrial silver demand fell modestly in 2018 due to a decline in PV Solar sector. According to the 2019 World Silver Survey, while Photovoltaic manufacture increased in 2018, actual silver consumption in PV solar cells and films fell by more than 8 Moz.

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