More than half of the world’s “new” silver — not the recycled stuff
but the ore taken out of the ground every year — isn’t mined as a
result of an honest-to-goodness silver-mining operation. Instead, it’s
a byproduct of a miner digging for other minerals such as copper and
zinc.

Now think of what’s happening in those particular metals markets —
they’re all way down in price just like silver and gold.

And what’s happening as a result of these seemingly eternal price declines?
Mining companies are reluctantly shutting down mine after mine. As a
result, global copper supplies — previously forecast to be in surplus
for 2016 — will likely be in a deficit instead, according to the
Platts metals news service.

Zinc is headed in the same direction.
Late last year, Glencore, one of the world’s largest mining companies,
announced the closure of its giant zinc-mining operation in Australia
in a move analysts at Woods Mackenzie say is likely “to have lasting
market impact.”

What does that mean for silver?
It means that not only is there less silver scrap being added to the
global market, but likely a lot less of the new stuff too — creating
an even stronger fundamental backdrop for both metals.