Chinese Gold Buying

Silver recycling can happen only at prices above $50

MUMBAI (Scrap Monster): Silver supply could increase only if more recycling takes place as in gold, but for recycling to become monetarily feasible, the price of silver should touch the historical high of $50 according to analysis by Chandni Burman in Daily News and Analysis (DNA).

The supply of silver scrap which was at 180.7 mn ounces in 2000 rose to 188 mn ounces in 2006 but thereafter declined to 165.7 mn ounces in 2009, according to The Silver Institute- GFMS survey.

Silver mine production rose by 4 percent to 709.6 Moz in 2009. Gains came both from primary silver mines and as a by-product of gold mining. Regionally, the strongest growth stemmed from Latin America, where silver output increased by 8 percent, with the most visible gains recorded in Argentina and Bolivia. Peru was the world's largest silver producing country in 2009, followed by Mexico, China, Australia and Bolivia.

All of these countries saw increases last year except for Australia, where output from the lead/zinc sector declined markedly. Global primary silver supply recorded a 7 percent increase to account for 30 percent of total mine production in 2009, according to The Silver Institute.

Meanwhile silver production is not being ramped up sufficiently to meet demand and some analysts opine that the world will run out of silver by 2020. "Silver is largely used as an industrial metal. It is a very good conductor of electricity, the best heat transfer agent and reflector of light, a very good lubricant, catalyst and alloy. But it is used in very small amounts as an industrial metal. Given this, it is not easy to recycle silver," the DNA report said.

Also, at its current price, it is not monetarily feasible to recycle silver. Experts are of the view recycling will become monetarily feasible only once the price of silver crosses around $50 per ounce (currently it quotes at around $32-33 per ounce). Given these reasons, increasing sale of silver scrap is not very easy, the DNA report added.

Amazing raw footage of the Bahrain protests

Max Keiser on Revolts: Americans Joining Middle East Uprising Trend

Gold rises above $1,400/oz as MEast violence spreads

From Reuters:
By Jan Harvey

LONDON, Feb 21 (Reuters) - Gold prices rose above $1,400 an ounce on Monday for the first time in nearly seven weeks as violence flared in North Africa and the Middle East, boosting interest in the precious metal as a haven from risk.

Tensions have spread from Egypt and Tunisia, where protests unseated leaders earlier this month, across the Middle East and North Africa, threatening the grip of long-entrenched autocratic leaders.

Spot gold rose as high as $1,400.40 an ounce and was bid at $1,399.60 an ounce at 1045 GMT, against $1,388.58 late in New York on Friday. U.S. gold futures for April delivery rose $11.70 an ounce to $1,400.30, having peaked at $1,401.30.

Gold priced in euros hit its highest since Jan. 19 at 1,023.91 euros an ounce, and sterling-priced gold its highest since Jan. 14 at 863.54 pounds an ounce.

"There is no doubt that the recent move higher across the precious metals reflects a degree of safe-haven buying as a result of the unrest in the Middle East," said Daniel Major, an analyst at RBS Global Banking & Markets.

Protests break out in Djibouti

For those who are not familiar with Djibouti it is located at the most strategic pinch point in the gulf of Aden (see map below). The US recently completed building a Naval base in the capital, from which they can patrol the Gulf Aden protecting their interests in Yemen, Saudi Arabia, Egypt, Jordan and Israel. Of course it also means the US has direct and quick access to both sides of the Suez Canal to ensure it always remains open (to the US at least).

US naval base in Djibouti (image courtesy of google maps)
Map of Djibouti (image courtesy of google maps)

Silver futures at record high, cross Rs 50,000 a kg

From Business Today:

Continuing its record-breaking spree on the back of firming trend overseas, silver futures prices shot up over 2 per cent to hit a new high of Rs 50,699 per kg.

Record levels in the spot market on rising demand, driven by the ongoing marriage season too, influenced the white metal prices at futures trade in New Delhi.

At the Multi Commodity Exchange counter, silver for delivery in September contract climbed Rs 1,043, or 2.10 per cent to trade at Rs 50,699 per kg - a level never seen before - with a turnover of four lots.

The silver for delivery in March contract also rallied by Rs 982, or 1.82 per cent, to trade at a record high of Rs 49,420 per kg, with a turnover of one lot.

Globally, silver in the Asian region, gained 1.4 per cent, to trade at $33.10, the fresh high since 1980.

Analysts said firming trend in precious metals in global markets, as spreading unrest in West Asia boosted their appeal as a safe-haven asset, buoyed the trading sentiment at futures trade in the national capital.

Meanwhile, at Chennai bullion market, silver prices rallied by Rs 400 to trade at record high of Rs 50,065 per kg in the opening trade.

Silver moves past old high

From Arabian Money:

A week ago and you could have made a good argument for the silver price being at a double top. And typically after confirming a previous high, a downturn would be in prospect.

But not after prices jumped to $32.60 by the end of the week, comfortably placing silver in a fresh stage of upward momentum.

It is not hard to reason why. There is the weakening dollar. Geopolitical upsets like the Arab World’s revolution in Egypt and its knock-on impact on Bahrain. Or the US budget deficit.

Hard assets

The rush to hard assets continues. Some observers will not be convinced of the silver price break out until it is confirmed by gold which has been a laggard in this rally and still not above its recent high of $1,430.

That confirmation should not be long in coming. UAE gold sellers report shortages of gold in January as canny local investors bought at lower prices. Mints around the world are having to ration coins.

Metal analysts see silver now heading to $36 before any further correction. But silver has always been volatile. It does, however, almost always outperform gold on the upside as well as on the downside.......read on

SIlver hits new post 1980 high of US$33

The US is becoming a Police State