Silver demand is quietly rising in areas beyond solar power, despite recent headlines failing to reflect significant short-term gains. While late September's tech news added less than 0.1 million ounces of measurable silver demand, electronics, excluding solar, are expected to require 9 million more ounces this year. This growth is spread across various products, providing a steady boost for silver holders over multiple years. However, this demand is not enough to offset the projected decline in solar panel silver usage, which is set to drop by 35.6 million ounces this year.
Silver's price has been under pressure from rising interest rates, trading at $60.68 an ounce on October 7, roughly half its January high. The Federal Reserve's rate hike on September 16 and a weak September jobs report have reduced the likelihood of another rate increase in October to about 20%. Despite this short-term pressure, the longer-term outlook for silver remains positive due to a supply shortfall and growing demand in electronics.
Technology news in late September highlighted several developments favorable for silver. China's 5G base stations surpassed 5.1 million by the end of August, and the country's grid storage battery sales more than doubled in August. SpaceX's Starship also launched 26 new Starlink satellites on September 28. However, not all news was positive, with delays in Amazon's satellite network and regulatory pauses on data-center projects in Texas and New Mexico.
The actual silver demand from these technological advancements is minimal. For example, the nearly 80 satellites launched in two weeks before September 28 carried only a few hundred ounces of silver. The broader forecast from Metals Focus and the Silver Institute projects a 6% decline in total electronics demand this year, driven by a drop in solar panel usage. Excluding solar, demand is expected to rise by about 9 million ounces, a positive sign for silver investors over the long term.