Washington refused to lock in a further sixteen years of the USMCA, so the trade terms covering Mexico — the source of a fifth of the world’s silver — now face review every year. No ounce stopped moving, but the metal’s largest single supply base sits under fresh policy risk while a sixth straight annual deficit runs on.
Silver’s biggest single supply base just moved onto a yearly policy clock. On July 1 the United States declined to renew the USMCA in its current form, the North American trade agreement, at its first mandatory joint review, while Mexico and Canada both backed a further sixteen-year extension. Nothing expired: the pact stays in force with its own terms running to July 1, 2036, but the refusal triggered a fallback under which the three parties now review it every year instead of settling one long extension.
Why the address matters more than the arithmetic
Mexico mines the most silver of any country, 172.9 million ounces in 2025 according to Metals Focus and the Silver Institute, ahead of Peru at 130.6 million and China at 112.8 million. Against global mine output of 846.6 million ounces, that is roughly one ounce in five. Putting that jurisdiction on a twelve-month cycle closes no mine and cancels no shipment; it removes certainty, not access.
US Trade Representative Greer tied the refusal to the agreement’s shortcomings and to trade deficits, and the official data show the US goods deficit with Mexico ran $196.9 billion in 2025 on a Census basis, behind only the European Union and China.
The structural backdrop has not shifted. The market is on track for its sixth straight annual deficit, forecast at 46.3 million ounces for 2026, meaning the world is set to use more silver than it produces again. Yet the survey also expects Mexican output to return to growth in 2026 after falling three years running, including a 5% drop in 2025, so the region now under the annual clock is the part of supply that may improve.
The copper decision still pending
A second measure reaches silver indirectly, because roughly three-quarters of the world’s silver surfaces as a byproduct of mining copper, lead, zinc, and gold. Semi-finished copper has carried a 50% tariff since August 2025, but the ores and concentrates that byproduct silver travels in were left out.
A phased duty on refined copper — 15% from January 2027, rising to 30% from January 2028 — now sits with the President after Commerce reported by June 30, 2026. Ahead of that call, COMEX copper inventories climbed from roughly 80,000 tonnes to about 650,000 as traders moved metal inside the tariff wall.
Price sits well below its peak
None of this shows up on the tape yet. Silver trades near $57, unable to crack $60, down roughly 20% from its 2025 close near $71 and about 53% below the January 29 all-time high of $121.62. The pull lower is monetary, not structural: higher oil revives inflation, a Federal Reserve that may stay hawkish lifts real rates, and silver, which pays no interest, gets sold.
Source: Investing.com
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