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When it comes to precious metals, gold often takes the spotlight, but silver is quietly gaining attention for its unique dual role, silver is both a precious metal and an industrial metal. This gives silver a rare balance of stability and growth potential. For anyone investing in silver in 2025, it’s important to understand silver’s dual identity before deciding whether to buy physical silver or invest in a silver ETF. In this blog, let’s break down silver’s dual nature and how you can invest in silver.
Use of Silver in Various Industries Globally
As you know, silver isn’t just a precious metal, it plays a key role in many industries around the world. As shown in the chart below, about 60% of global silver demand comes from industrial applications. This includes its use in solar panels, electric vehicles (EVs), electronics and batteries, where silver’s excellent conductivity makes it essential for modern technology.
Jewellery and coins & bars segments each account for 18% of total demand. In countries like India, silver jewellery and coins are especially popular during festivals and weddings. Remaining 4% comes from silverware, which includes traditional items like utensils and decorative pieces.
Use of Silver in Different Industry (%)
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Silver as a Precious Metal
Silver has been valued for centuries for its beauty and reliability. Like gold, it’s a precious metal and a trusted store of value, helping protect wealth during inflation and uncertain markets. However, unlike gold, silver has a smaller market and tends to be more volatile, which means it can deliver higher growth potential for investors willing to take some risk.
Its dual identity as both a precious metal and an industrial commodity makes silver attractive, as global demand for clean energy and technology is surging. For new and small investors, investing in silver ETFs offers a simple and affordable way to benefit from silver’s long-term growth while maintaining portfolio stability..
Silver as an Industrial Metal
Beyond its shine, silver quietly powers our modern world from smartphones and electric vehicles to solar panels and medical devices. Unlike gold, which is mainly mined for jewelry and investment, nearly 70–72% of silver comes as a by-product of mining other metals like copper and zinc. Just 28% sourced from primary silver mines
In 2025, global industrial silver demand is at a record high, making up over 60% of total usage. This strong demand, combined with limited supply, has created a global silver shortage, pushing prices higher. Silver’s excellent electrical and thermal conductivity makes it essential for clean energy and technology growth.
It’s a crucial aspect of modern innovations like:
- Electric Vehicles: Global shift to electric vehicles (EVs) has created a major new source of silver demand. Each EV uses about 25–50 grams of silver in its wiring, sensors and circuits. Due to its excellent conductivity, silver is essential for EV batteries and electrical systems. As EV market grows rapidly, annual silver demand from this sector could soon exceed 90 million ounces.
- Solar Panels: Silver paste is essential in solar panels, helping photovoltaic (PV) cells conduct electricity efficiently. Solar industry now uses nearly 20% of global silver and demand is expected to surge as nations accelerate clean energy and decarbonization efforts.
- Electronics & 5G Technology: Beyond clean energy, silver is now an essential part of modern technology. It’s used in smartphones, semiconductors, 5G networks and AI systems.
- Medical Uses: Its antimicrobial nature helps in water filters, hospital surfaces and wound care.
Why Silver’s Dual Identity Matters Now?
The mix of precious metal and growing industrial demand makes silver one of the most preferred investments in 2025. When markets turn uncertain, silver acts as a safe hedge like gold. And when the economy grows, demand from industries such as solar, EVs and electronics pushes its price even higher. That balance is why silver prices have surged over 60% this year, outperforming gold. It’s a rare metal that performs well in both good and bad times, making it a standout choice for investors in 2025.
Global Silver Supply Landscape in 2025
Global silver market remains diverse but concentrated among a few key producing nations. Mexico, China and Peru continue to lead the world in silver production, followed by countries like Australia, Russia, Bolivia and United States. India, ranking 11th, produced 22.5 Moz, slightly lower than the previous year.
Here are the Top 20 Silver-Producing Countries (2024 vs 2023)
| Rank | Country | 2023 (Moz) | 2024 (Moz) | YOY Change |
|---|---|---|---|---|
| 1 | Mexico | 181.9 | 185.7 | 2% |
| 2 | China | 111.6 | 110.1 | -1% |
| 3 | Peru | 108.9 | 108 | -1% |
| 4 | Bolivia | 43.2 | 47.8 | 11% |
| 5 | Chile | 52 | 43.2 | -17% |
| 6 | Poland | 42.5 | 42.5 | 0% |
| 7 | Russia | 38.3 | 41 | 7% |
| 8 | Australia | 32.7 | 38.8 | 19% |
| 9 | United States | 33.1 | 36.2 | 10% |
| 10 | Argentina | 26 | 24.9 | -4% |
| 11 | India | 23.8 | 22.5 | -5% |
| 12 | Kazakhstan | 16.4 | 16.1 | -2% |
| 13 | Sweden | 12.6 | 11.6 | -8% |
| 14 | Indonesia | 10.9 | 11.5 | 5% |
| 15 | Canada | 7.1 | 9.5 | 33% |
| 16 | Morocco | 8.9 | 8.6 | -4% |
| 17 | Uzbekistan | 7.1 | 7.8 | 9% |
| 18 | Papua New Guinea | 4.3 | 4.2 | -3% |
| 19 | Spain | 3.7 | 3.5 | -5% |
| 20 | Portugal | 3.4 | 3.5 | 3% |
| 21 | Others | 44.4 | 42.8 | -4% |
Source: Silver Institute’s World Silver Survey 2025 (Metal Focus)
- Physical Silver
The most traditional way to invest is by buying silver coins, bars, or jewellery. It gives you direct ownership and a sense of security since you can hold it in your hands. However, physical silver needs safe storage, may have making charges or purity variations and can be less liquid when you need to sell quickly.
- Silver ETFs
If you prefer a simple and hassle-free option, Silver Exchange-Traded Funds (ETFs) are ideal. These funds mirror silver prices and can be bought or sold easily through your Demat account just like shares. They save you from the worry of storage and purity checks. In India, silver ETFs have gained popularity in 2025, due to their transparency, affordability and easy access for retail investors.
- Silver Mining Stocks
Investing in silver mining stocks is another indirect way to gain exposure. These stocks can rise faster than silver prices when demand is strong, but they also carry business and operational risks.
- Silver Futures and Mutual Funds
For experienced investors, silver futures allow you to trade based on price movements offering higher potential returns but also higher risk. Beginners can consider silver mutual funds or fund-of-funds, which invest in silver ETFs on your behalf and provide professional management with minimal effort.
FAQs
Is silver a good investment?
Yes, silver can be a good investment if you understand its role. It acts as both an inflation hedge and a growth asset, due to rising use in industries like EVs and solar energy.
Should you invest in silver or gold?
Gold is known for stability and long-term security, while silver offers higher growth potential due to industrial demand. The best strategy is often to hold both for diversification.
What factors influence silver prices?
Silver prices move based on industrial demand, global supply levels, investor sentiment and economic trends such as inflation, currency movement and interest rate changes.
Is silver better for short-term or long-term investment?
Silver can be good for both it may deliver quick gains in strong markets, but due to volatility, it works best when held for long-term portfolio growth alongside gold.
What are the risks of investing in silver?
Silver prices can be volatile since demand depends heavily on industries like electronics and renewable energy. Price swings can be sharp, so investors should assess risk tolerance before investing.
Happy investing and thank you for reading!
Disclaimer:
This website content is only for educational purposes, not investment advice. Before making any investment, it’s important to do your own research and be fully informed. Investing in the stock market includes risks, and you should carefully read the Risk Disclosure documents before proceeding. Please remember that past performance doesn’t guarantee future results, and due to market fluctuations, your investment goals may not always be achieved.
