In-depth Analysis of the Turning Point in COMEX Silver Inventory Cycle

Based on the latest market data and research materials, I will provide you with a systematic analysis report on the turning point in the COMEX silver inventory cycle.

As of December 2025, COMEX silver inventory has fallen to its lowest level in nearly five years, forming a clear turning point signal in the inventory cycle. According to Wind data, COMEX silver inventory dropped from a high of approximately 16,540 tons at the end of September to around 14,200 tons in mid-December, a decrease of about 16.5% [1]. This downward trend is not a short-term phenomenon but continues the inventory contraction trend throughout 2025.

From the comparison of inventory in major global markets, the inventory structure shows obvious differentiation:

• COMEX Inventory
  : Dropped to five-year low, deliverable inventory continues to decline [1]
• London Bullion Market Association (LBMA) Vaults
  : Remain at around 20,000 tons, but the proportion of freely deployable and delivery-eligible parts continues to decrease [2]
• Shanghai Gold Exchange
  : Inventory dropped to 687.195 tons on November 28, hitting a near-decade low [1]

This situation of ‘total inventory not exhausted but marginal available inventory shrinking sharply’ has become the core driver of the current silver price surge [2].

The 2025 report from the Silver Institute shows that the global silver market will see a structural supply deficit for the fifth consecutive year. The 2025 deficit is expected to be about 95 million to 117 million ounces (approximately 2,950-3,670 tons), with a cumulative deficit reaching 820 million ounces [3][4].

The core reason for the stagnation in mine supply is that silver is often a by-product of copper, lead, zinc, and other metal mining, and price increases do not always lead to proportional new supply [4]. In November 2025, the China Copper Concentrate Purchasing Team (CSPT) required member enterprises to reduce copper mine operating load by more than 10% in 2026. Based on an average silver content of 80-90 grams per ton of blister copper, this will directly cut by-product silver supply by 800-900 tons, accounting for about 3% of global mine silver [1].

Industrial demand hits record high, becoming the core support for silver prices:

1. Photovoltaic Industry
   : The International Energy Agency (IEA) predicts that new solar installed capacity will reach 4,000 gigawatts from 2024 to 2030. Solar energy alone will drive silver demand up by nearly 150 million ounces annually, an increase of 13% compared to the 1.169 billion ounces of physical demand in 2024 [3][5]

2. AI Data Centers and New Energy Vehicles
   : The explosive growth of emerging industries drives silver industrial demand [6]

3. Surge in Investment Demand
   : Global silver ETF holdings have increased significantly since October, with institutions and high-net-worth individuals purchasing and hoarding large amounts of physical silver through ETFs or investment banking channels [7]

As of December 23, 2025, spot silver prices have broken through the $70 per ounce mark, with a cumulative increase of over 110% this year, significantly outperforming gold’s approximately 60% increase over the same period [7][8]. The silver-to-gold ratio has compressed from nearly 80 at the beginning of the year to below 70, hitting a new low since 2021 [4].

• December 9, 2025: Broke through $60 per ounce, hitting an all-time high
• Mid-December 2025: Reached the range of $64-$65 per ounce
• December 23, 2025: Broke through the $70 per ounce mark

The core logic of this market rally lies in ‘marginal available inventory’ rather than ‘total inventory’:

1. Exchange Inventory “Reservoir” Becomes Shallow
   : Traditional inventory replenishment mechanism has become ineffective. After prices hit new highs, inventory only recovers slowly or even declines instead of rising, indicating that the ‘high price attracts mining’ mechanism has been partially ineffective due to financial lock-up, regional accumulation, and circulation friction [2]

2. Changes in Futures Curve Structure
   : The sensitivity of futures and spot markets to inventory location and delivery capacity has increased significantly, with the futures curve switching from contango to deep backwardation multiple times [2]

3. Delivery Pressure Amplifies Volatility
   : December is a traditional peak delivery month, and COMEX silver futures delivery volume in recent months has far exceeded the seasonal average. Against the backdrop of low inventory, the tight spot supply situation is difficult to ease quickly [7]

• Fed Easing Expectations
  : The market expects a more than 70% probability that the Fed will cut interest rates by at least 50 basis points cumulatively by 2026 [7]
• Sustained Low Inventory
  : Deliverable inventory is the smallest but the only truly effective inventory for futures delivery; its continuous decline amplifies the supply-demand gap [1]
• Resilient Industrial Demand
  : Demand from emerging industries such as photovoltaics, AI data centers, and new energy vehicles remains strong

• Technical Correction Pressure
  : With an increase of over 120% this year, short-term investors’ sensitivity to news has risen; any data or policy that falls short of expectations may amplify correction risks [3]
• Profit-Taking by Funds
  : The fund-driven market leads to rapid changes in market sentiment; the demand for profit-taking by funds may trigger violent fluctuations in the market [7]
• Historical Experience Warning
  : CME raised silver futures margins by 10% on December 12; attention should be paid to similar signals before the silver crashes in 1980 and 2011 [9]

• Under the resonance of tight inventory and surging demand, silver prices will continue to trend oscillating and strong
• Need to pay attention to technical correction risks; any negative factors may be amplified

• Analysts generally expect silver prices to break through $100 per ounce [4][8]
• Paul Williams of Solomon Global predicted as early as October (when silver was near $50) that it would break through $100 before the end of 2026 [4]
• The structural supply-demand gap is expected to persist, although it may narrow somewhat

• Green energy transition will continue to support silver industrial demand
• Structural constraints on mine supply are difficult to ease quickly
• The dual drive of investment demand and industrial demand will dominate the long-term upward shift of the price center

The drop in COMEX silver inventory to a five-year low marks the establishment of a turning point in the inventory cycle. Against the backdrop of structural contraction on the supply side for five consecutive years and record-high demand on the demand side, the continuous decline in marginal available inventory has become the core amplifier of the price surge. Investors need to closely monitor inventory change trends, the Fed’s monetary policy path, and industrial demand growth momentum to seize investment opportunities and manage risks in this historic market.

[1] Huxiu.com - Silver is soaring, what signal is it sending? (https://www.huxiu.com/article/4812603.html)

[2] FT Chinese - After silver prices break $60: Who is snatching the last batch of “available silver”? (https://www1.ftchinese.com/story/001108508)

[3] Sina Finance - Silver suddenly surges, breaking through the $70 mark to a new high (https://finance.sina.com.cn/stock/hyyj/2025-12-23)

[4] Wall Street CN - Silver surge continues, New York silver rises by up to 6.0% intraday, next stop $100? (https://wallstreetcn.com/articles/3761215)

[5] 36Kr - Gold has risen for over three consecutive years; will there be a turning point after the BIS warning? (https://m.36kr.com/p/3589415707672838)

[6] Sina Finance - Gold has risen for over three consecutive years; will there be a turning point after the BIS warning? (https://finance.sina.com.cn/stock/hyyj/2025-12-23)

[7] Sina Finance - Tight inventory + surging demand support silver, facing technical correction (https://finance.sina.com.cn/money/nmetal/roll/2025-12-25)

[8] 21st Century Business Herald - Silver suddenly surges, breaking through the $70 mark to a new high (https://news.qq.com/rain/a/20251223A06NTY00)

[9] NetEase - Crazy silver! Witness history,开启 (start) double-digit growth mode (https://www.163.com/dy/article/KHPTROFQ0519D8O6.html)