Silver sees best annual return in 10 years; holds 45-year trend on charts.

Looking ahead to 2025, with demand forecast at 1,148.3Moz against supply of 1,030.6Moz, the silver market, Nomura said, faces its fifth consecutive year of deficit at 117.6Moz

Silver prices that hit nearly $44 an ounce (oz) in the international markets and Rs 134,089 per kilogram (kg) back home are up 56 per cent thus far in calendar year 2025 (CY25). This is the highest return that silver has given in the last 10 years (since calendar year 2016). 

Silver has also outperformed gold (up around 49 per cent at Rs 113,129 per 10 gram) thus far in CY25. The last time silver prices gave such a phenomenal return was in 2020 when the prices rose 44 per cent in a year to Rs 67,383/kg in the Indian markets, data shows. Gold prices back then had surged 27.9 per cent year-on-year (Y-o-Y) to Rs 50,001/10 gram. 

ALSO READ: Chris Wood sees gold prices at $6,600 in a secular bull market; here's why

Silver prices that hit nearly $44 an ounce (oz) in the international markets and Rs 134,089 per kilogram (kg) back home are up 56 per cent thus far in calendar year 2025 (CY25). This is the highest return that silver has given in the last 10 years (since calendar year 2016). 

By 2024, the industrial demand hit a record high of 680.5Moz (million ounces), suggests a note from Nomura, contributing to a total demand of 1,164.1Moz against a total supply of just 1,015.1Moz, creating a significant market deficit of 148.9Moz.

This structural shift, analysts said, has been primarily driven by three key sectors: renewable energy, EVs, and electronics, with China's aggressive adoption of high-silver-content N-type solar cells leading global demand growth

Silver has also outperformed gold (up around 49 per cent at Rs 113,129 per 10 gram) thus far in CY25. The last time silver prices gave such a phenomenal return was in 2020 when the prices rose 44 per cent in a year to Rs 67,383/kg in the Indian markets, data shows. Gold prices back then had surged 27.9 per cent year-on-year (Y-o-Y) to Rs 50,001/10 gram. 

ALSO READ: Chris Wood sees gold prices at $6,600 in a secular bull market; here's why

The impact of this sustained demand surge, Nomura believes, is evident in the rapid depletion of above-ground inventories, which have declined sharply from 22-months of supply in December 2020 to just 13-months by December 2023.  

ALSO READ: Silver imports likely to gain momentum from strong investment demand

Adding to its appeal is the current gold-to-silver ratio of 84, suggesting significant undervaluation compared to gold. Typically, the gold-to-silver ratio indicates how many ounces of silver are needed to buy one ounce of gold. A higher ratio indicates gold is expensive relative to silver, while a lower ratio suggests silver may be undervalued and could be a better investment.