By Penny Langford
Silver’s 2026 outlook is being shaped by a sharp contradiction: solar installations continue to expand, but the amount of silver used in each panel is falling. J.P. Morgan Global Research estimates that solar-related silver demand could decline by around 30%, or approximately 60 million ounces, during the year as manufacturers accelerate thrifting and substitution.
That forecast does not mean industrial silver demand is collapsing. The Silver Institute expects overall industrial fabrication to fall by about 2%, to roughly 650 million ounces, while demand from data centers, artificial intelligence, automotive systems and electric vehicles provides some offset.
The distinction matters for operators and investors. Silver is no longer only a monetary metal, but its industrial growth story is not immune to technology changes. The market’s direction will depend on whether gains from electrification, electronics and investment demand can compensate for declining silver intensity in solar manufacturing.
The 30% test is concentrated in solar
The 30% figure is a forecast for solar silver demand, not a prediction that total industrial demand will fall by 30%.
J.P. Morgan’s Gregory Shearer said the adoption of silver-thrifting technologies and a period of destocking could reduce solar demand by approximately 60 million ounces year over year. The bank also expects silver to average about $70 an ounce during 2026, with a fourth-quarter average near $63 an ounce.
The Silver Institute’s outlook is less severe for the broader market. It forecasts a 2% decline in industrial fabrication, with photovoltaic demand identified as the main source of weakness. Solar installations are still expected to increase, but manufacturers are using less silver per cell and increasingly testing copper-based alternatives.
That trend is visible in the longer-term data. An Oxford Economics report commissioned by the Silver Institute says solar photovoltaics accounted for 29% of industrial silver demand in 2024, up from 11% in 2014. Yet silver demand from photovoltaics grew only threefold over the decade, while installed PV capacity increased more than tenfold.
The gap reflects the industry’s learning curve. Better cell designs, narrower conductive lines, improved pastes and copper-plating technologies allow manufacturers to produce more solar capacity without increasing silver consumption at the same rate.
Silver intensity is falling as solar manufacturers reduce paste loadings and test copper-based alternatives.
Solar growth can continue while silver demand falls
This is the central issue in the 2026 silver price prediction.
Solar demand and silver demand are related, but they are not identical. If global PV capacity rises 17% annually, as Oxford Economics cites from International Energy Agency projections, while silver use per watt falls faster, total silver consumption can decline even as solar deployment reaches new highs.
Technology selection will determine how quickly that happens. Oxford Economics notes that newer TOPCon cells currently use more silver than older PERC cells, although consumption is expected to decline as the technology matures. Copper-plating and silver-coated copper powder could reduce silver use by between 30% and 50% in some applications, according to the report.
The substitution process will not be immediate. Copper-based technologies face challenges involving efficiency, reliability and long-term durability. Solar manufacturers also need to balance the cost savings from lower silver use against production yields and performance guarantees.
This creates a two-speed outlook:
- Near term: PV remains a major silver consumer, but thrifting and substitution reduce demand growth.
- Medium term: Copper-based technologies could put more pressure on silver intensity if they achieve commercial scale.
- Long term: Solar capacity can keep growing, but silver demand will depend on the materials used in each generation of cell.
For investors, the relevant measure is not simply global solar installations. It is silver consumption per watt, the pace of copper substitution and the volume of new cell capacity using higher-silver architectures.
Gold remains the macro anchor
Silver’s industrial exposure gives it greater upside sensitivity than gold during periods of manufacturing growth, but it also makes silver more vulnerable when interest rates rise or industrial activity slows.
The gold/silver ratio illustrates that relationship. The Silver Institute said silver briefly pushed the ratio below 50 early in the year before retreating below $80 an ounce. J.P. Morgan expects the ratio to move back toward approximately 70 as physical-market tightness eases and monetary policy becomes less supportive.
Gold remains the more defensive metal because central banks, institutional investors and reserve managers buy it for monetary and geopolitical reasons. Silver benefits from some of those same forces, but its smaller market and industrial demand base can produce larger price movements in both directions.
The LBMA 2026 forecast survey shows the range of opinion. Individual analyst averages for silver span from roughly $44 an ounce at TD Securities to $83 an ounce at Metals Focus and $79 an ounce at Standard Chartered. The wide range reflects disagreement over investor flows, physical inventories, industrial demand and the durability of the recent precious-metals rally.
The market is therefore being pulled by two separate forces:
- Gold-linked support: geopolitical risk, central-bank demand, currency concerns and interest-rate expectations.
- Industrial sensitivity: solar thrifting, electronics demand, automotive production and global manufacturing activity.
Silver prices will likely remain highly responsive to changes in both.
Supply remains slow to respond
The demand test is significant because silver supply cannot quickly adjust to a change in price.
The Silver Institute expects total silver supply to rise 1.5%, reaching about 1.05 billion ounces. Mine production is forecast to increase 1%, to approximately 820 million ounces, while recycling is expected to rise 7% and exceed 200 million ounces for the first time since 2012.
Even with that increase, the market is projected to remain in deficit by 67 million ounces, marking a sixth consecutive annual shortfall.
Silver’s supply response is constrained by mine development timelines and its role as a by-product of other metals.
Much of the world’s silver is produced alongside lead, zinc, copper and gold. That means higher silver prices do not automatically lead to a proportional increase in mine supply. Operators generally make production decisions based on the economics of the primary metal, not silver alone.
A copper mine may produce more silver as a by-product if it expands, but a higher silver price by itself will not necessarily justify a new copper project. The same applies to lead-zinc operations, where weak prices can threaten the sustainability of silver-bearing production.
This supply structure helps explain why a 30% decline in solar demand does not automatically eliminate the deficit. It would remove a substantial volume of demand, but the remaining market would still need to balance industrial consumption, physical investment, jewelry, electronics and inventory flows against a relatively inflexible supply base.
Linkable data table: the silver market in focus
| Indicator | 2026 outlook or recent benchmark | Why it matters |
|---|---|---|
| Solar share of industrial silver demand | 29% in 2024 | PV is the largest structural industrial exposure |
| Potential solar demand decline | About 30%, or 60 Moz | J.P. Morgan estimate tied to thrifting and substitution |
| Industrial fabrication | About 650 Moz | Silver Institute forecast for 2026, down 2% |
| Total silver supply | About 1.05 billion oz | Forecast to rise 1.5% to a decade high |
| Mine production | About 820 Moz | Forecast to increase 1% |
| Recycling | More than 200 Moz | Forecast to rise 7% |
| Market balance | 67 Moz deficit | Sixth consecutive annual shortfall |
| Physical investment | 227 Moz | Forecast to rise 20% |
| J.P. Morgan silver forecast | $70/oz average | Q4 estimate near $63/oz |
| LBMA analyst averages | About $44–$83/oz in selected forecasts | Shows unusually wide market uncertainty |
Sources: Silver Institute, Oxford Economics, J.P. Morgan Global Research and LBMA.
Silver price prediction: base, bull and bear cases
| Scenario | Industrial demand | Gold and macro conditions | Silver price framework |
|---|---|---|---|
| Bear case | Solar demand falls sharply and electronics weaken | Higher real rates, stronger dollar and weaker gold | Prices move toward the lower end of the LBMA forecast range |
| Base case | PV demand falls, but EVs, data centers and electronics offset part of the decline | Gold remains elevated while investor demand normalizes | Roughly $60–$80 an ounce, with significant volatility |
| Bull case | Thrifting is slower than expected and non-PV industrial demand accelerates | Gold rises, physical inventories tighten and investment flows strengthen | Prices revisit or exceed recent highs, potentially moving above $90 an ounce |
The base case is not a straight-line forecast. It assumes that solar-related demand weakens but that the market remains undersupplied. It also assumes silver continues to receive support from gold without repeating an extreme investment-driven rally.
The bull case requires more than strong solar growth. It would likely need a combination of sustained gold strength, renewed exchange-traded product inflows, limited mine-supply growth and physical-market tightness.
The bear case would become more credible if the 30% solar decline coincides with a manufacturing slowdown, weaker Chinese imports, higher interest rates and a reversal in gold investment demand.
Investor takeaways
The 30% figure should be used as a stress test rather than a standalone price target.
Investors and analysts should monitor five indicators:
- Solar silver intensity: ounces used per watt and the pace of copper substitution.
- Non-PV industrial demand: electronics, automotive systems, EV charging and data centers.
- Gold/silver ratio: a measure of whether silver is outperforming or lagging its monetary counterpart.
- Physical investment and exchange-traded holdings: especially when industrial demand is weakening.
- Mine supply and recycling: including output from primary silver mines and by-product operations.
A falling solar demand line does not necessarily invalidate the silver market’s structural deficit. But it does challenge the assumption that renewable-energy growth automatically produces equivalent growth in silver consumption.
Gold provides the macro anchor while silver adds industrial exposure and greater price sensitivity.
The most defensible conclusion is that silver enters a more selective phase. Solar remains strategically important, but technology is reducing its material intensity. At the same time, automotive electrification, AI infrastructure and electronics continue to create new uses for the metal.
For mining companies, the outlook reinforces the value of reliable by-product production, recycling capacity and supply-chain visibility. For investors, it argues for separating the monetary case for silver from the industrial case rather than treating them as a single demand story.
Additional context is available in Skillings’ coverage of gold mining costs and margins, copper price risks and critical-minerals supply-chain concentration.
Social snippets
LinkedIn: Solar photovoltaics account for about 29% of industrial silver demand, but J.P. Morgan estimates solar-related silver use could fall 30%, or 60 million ounces, as manufacturers accelerate thrifting and copper substitution. The market may still remain in deficit as EVs, electronics, AI infrastructure and investment demand offset part of the decline.
X: Solar uses ~29% of industrial silver demand. J.P. Morgan sees PV silver demand falling ~30% in 2026, or 60 Moz. But the Silver Institute still forecasts a 67 Moz market deficit as supply remains slow to respond. #Silver #Gold #CriticalMinerals #Mining
