Peru mined about 131 million ounces of silver in 2025, close to one ounce in six of world supply, and its incoming government may meet renewed protest in the mining regions. Global mine output is forecast essentially flat for 2026, so there are no spare ounces to cover a disruption. Silver trades near $59.43 an ounce.
The more durable threat to silver in July was not the shooting war in the Middle East but a peaceful election in Peru. Reuters reported on July 15 that president-elect Keiko Fujimori could face renewed protests in the country’s mining regions as her incoming government tries to push forward copper and other mining projects that have been delayed for years.
That report drew on a study by the Observatory of Mining Conflicts in Peru, which counts roughly $64 billion in planned mining investment, much of it in poor rural areas where communities say they see little local benefit and worry about the environmental cost. The backdrop was already unsettled before the result: Peru issued an emergency decree in May to deal with an energy shortage, road blockades have periodically interrupted shipments of concentrate, and the program to formalize its large informal-mining sector has been extended into the end of 2026.
Most Peruvian silver comes out as a byproduct
Two features make Peru’s contribution to silver supply especially fragile. Peru’s mines are dug primarily for lead, zinc, and copper, with silver arriving alongside those metals rather than as the main event, and mines built primarily for silver have fallen to just 26% of global supply, a record low, according to Metals Focus and the Silver Institute.
Because of this, Peruvian supply rises and falls with decisions driven by the economics of lead, zinc, and copper, and it cannot easily be increased just because silver is expensive. Many of the country’s silver projects are also run by small and mid-sized companies with thin balance sheets, which makes them more vulnerable to the energy-cost spikes and road blockades that periodically disrupt its mining regions.
Flat mine supply leaves no cushion
Global mine production came in at 846.6 million ounces in 2025. Metals Focus and the Silver Institute forecast 844.1 million ounces for 2026, a decline of about 2.5 million ounces, and the survey already expects Peruvian output to fall on weaker lead and zinc production, naming Peru first among the declines that outweigh recovering output in Mexico.
The market is also forecast to run a sixth consecutive annual deficit of 46.3 million ounces in 2026, meaning the world consumes more silver than it produces and recycles and covers the difference from existing stocks. A serious disruption in Peru would also tighten the silver-bearing concentrate feeding Chinese refineries, which handle most of the world’s silver refining, while China’s own export controls keep more of its refined silver at home.
Silver near $59.43 as macro sets the short term
Silver trades near $59.43 an ounce with the gold-silver ratio around 69, a level long-term buyers read as silver being inexpensive against the larger metal. The metal is up more than 50% from where it stood a year ago, though it remains well below the record of $121.62 set on January 29.
Most of the past fortnight’s price action came from the Middle East, where renewed strikes on Iran drove oil higher and pulled silver down with it. Yet those moves come and go with the macro headlines, while the longer-term case rests on a supply base that is flat, concentrated, and increasingly political.
Source: Investing.com
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