Even though markets have been very volatile lately, one has been pretty calm: gold GC00 1.31% has climbed to new highs, going above $2,500 an ounce for the first time.
As a pilot fish, silver SI00 2.27% tends to follow the bigger bullion. However, the gray metal has not followed gold’s record-setting, and is now selling at around $29.40 an ounce.
There are a lot of preachers and hype in the world of precious metals. On the other hand, there is a view that silver has done better than gold over the last five sessions.
The analysis comes from Kevin Bambrough, a retired financial professional who used to be president of the Canadian asset manager Sprott and now tweets and posts videos on YouTube about precious metals.
Bambrough recently wrote on X that Samsung’s 005930 -0.77% new solid-state battery technology, which includes a silver-carbon (AG-C) combination layer, should make a lot more people want to buy silver.
Bambrough says that range, charge time, battery life, and safety are the most important factors that will increase demand for EVs. He predicts that Samsung’s technology will lead to a battery with a 600-mile range, a 20-year lifespan, and a nine-minute charge.
There is one very, very important caveat: official numbers are not available. It is thought by Bambrough that each cell in Samsung’s new batteries may use up to five grams of silver.
“A typical EV battery pack with about 200 cells and a 100 kWh capacity might need around 1 kg of silver per vehicle,” he says.
Bambrough says that about 80 million cars are made around the world every year. If, say, 20% of these were electric vehicles and used Samsung solid-state batteries, the demand for silver would be about 16 million metric tons per year.
“This would make up a big chunk of the world’s current silver production, which is about 25,000 metric tons per year, showing how big of an effect it would have on the silver market,” says Bambrough.
Some figures say that the solar industry has already helped put the silver market in deficit by driving up demand. This is because people are buying more silver than they are selling it for, which includes jewelry and investments.
Bambrough is ready to admit that his numbers are just making things up. “Maybe 5 grams is too much.” Maybe 20% will not be enough for solid-state batteries to make their way into the auto business. It could be as much as 50% or more in 10 to 15 years, he says.
In a later post, Bambrough said that his guess about how much silver was in each battery cell was wrong and that it could be as little as 0.5 grams per cell.
Still, Samsung’s technology suggests that the silver market will become even more tight. This will allow, as he puts it, “the price of silver to take a run at its all-time inflation-adjusted high [of] $200/oz,” which is likely to happen in the next 10 to 15 years.
“Just look at the silver chart from the 1970s to see how quickly the price of the precious metal can go through the roof when there is a real shortage and investors decide to stock up,” he says.
