Silver Institute confirms metals investment-demand boom in 2016

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The World Gold Councils equivalent in the silver sector, The Silver Institute, just issued a bullish assessment of the white metals performance in the first half of 2016.

From Jan. 4 through July 11, silver has gained more than 44%, the institute noted, citing London Bullion Market Association price data.

Investment demand for silver has been increasing on almost every front. ETF holdings hit a record high of more than 662 million ounces, while net longs in the futures and options markets also are at all-time levels.

And in the physical market, coin sales are booming again in 2016, up 29% for the first quarter of this year, growing at at double digit paces in all the major regions of the world. The only down spot the institute found was a dropoff in the consumption of silver bars in the first half.

The institutes findings on silver have been borne out by data from the major sovereign mints around the world. Silver American Eagle sales from the U.S. Mint remain on a record sales pace, though demand has tailed off somewhat in recent weeks.

As of July 14, more than 26.945 million silver Eagles have been sold. Thats 10% more than were purchased at the same time in 2015, meaning that the Mint can still break the all-time sales record of 47 million set last year.

Meanwhile, Australias Perth Mint, with its silver Koala and Kangaroo coins, also enjoyed a blockbuster first half. Its sold more than 1 million ounces of silver coins for nine of the 10 past months, and its first-half sale totals of 7.636 million ounces easily topped last years figure of 2.81 million ounces.

Although the Royal Canadian Mints latest report hasnt yet been released, sales of its flagship silver Maple Leaf coins followed up on 2015s record year by setting a new all-time high in the first quarter of 2016.

Figures also are pending for the Austrian Mints 2016 sales of its silver Philharmonics, but its combined silver sales in 2015 hit 7.3 million ounces.

Although silver is potentially vulnerable to a pullback after its blistering run so far this year, its future looks bright thanks to its dual nature as a monetary metal and an industrial commodity.

I firmly believe we are on the cusp of an explosion in the silver price that will ultimately see silver trade at many multiples of the current $20 price, industry veteran John Embry recently observed. And another analyst even thinks that Americans and Canadians will likely face silver shortages in the future as investment demand continues to surge higher as the price skyrockets. The time to load up on silver is now, while the price is comfortable below its all-time high near $50.