Resource Maven Gwen Preston On Silver’s Bullish Future as a Green Technology Commodity
Gwen Preston of the Resource Maven joined Commodity Culture host, Jesse Day, to discuss where she thinks the commodities space is headed as inflation skyrockets and clean energy concerns continue to mount.
Silver has its uses as both an industrial and monetary commodity. Like gold, silver as a monetary asset may be used as a hedge or safe haven against tail risks. As an industrial metal, silver is used in many electronics—for example, in solar panels—and for medical purposes, among others.
Despite current low silver prices (down 16.62% since the beginning of the year), Preston remains optimistic about the future of the commodity, arguing that while silver tends to “get hit harder on the investment side” than, say, gold, its “saving grace” is the industrial side.
“That is where my bullishness really sits with silver,” she shared.
Solar panels are one of the most important uses of silver, especially when thinking in terms of growth, Preston points out: “Currently, solar panels take about 10% of silver. The international energy association’s projection for how many solar panels we’re going to need to meet all of the various goals for green energy would require us to increase solar energy almost tenfold, so that alone suggests that solar panels would take up all of silver demand in the next [10-15] years.”
“That’s pretty bullish on its own because obviously solar panels can’t take all the silver, there’s still other things that need silver. But the thing that really tips this over,” she adds, “is that China is by far the leader in solar panel technology and the Chinese have been increasing the silver load in their solar panels significantly as of late, doubling or tripling the amount of silver that goes into a solar panel.”
Increasing the silver load in solar panels, Preston points out, makes them more efficient and therefore more profitable—“All of a sudden you have solar panels needing 200 or 300% of the amount of silver that is produced—that is a supply gap that’s pretty dramatic.”
That same increase in demand for solar panels and other “green” technologies means that critical commodities like copper and silver have to come to the forefront of the conversation, says Preston. “Metals just have to be worth more, there’s just no question about it.”
The price of silver has increased 1.55% over the last 30 days and is currently (as of September 19, 2022) trading at US$19.36 per ounce.
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