Silver Price Forecast 2026: Structural Revaluation Pushing $70 as the New Floor

From Commodity Shadow to Industrial Essential

Silver’s trajectory in 2026 tells a story about supply scarcity and structural demand, not speculation. After breaking through US$66/oz in late 2025, the metal is no longer tracking gold’s movements. What’s driving this divergence? Three structural factors: persistent global supply deficits, explosive growth in industrial consumption, and a critical new role in infrastructure that most market observers are still underestimating.

Unlike gold—primarily a store of value—silver is becoming indispensable in systems where its thermal and electrical conductivity cannot be replicated. With above-ground inventories at multi-year lows and production unable to respond quickly to price signals, the market is pricing in a fundamental revaluation. For 2026, analysts increasingly expect US$70/oz to function as a base level rather than resistance, reflecting this shift in how the metal is valued and consumed.

The AI Infrastructure Demand Surge Nobody’s Talking About

The fastest-growing driver of silver consumption remains largely invisible in mainstream market discussion: artificial intelligence infrastructure. As hyperscale data centres expand globally to support large language models and advanced computing workloads, silver absorption inside semiconductor devices, power systems, and thermal management has accelerated dramatically.

High-performance servers used in AI environments consume two to three times more silver than traditional data centre equipment. The metal appears in printed circuit boards, interconnects, thermal interfaces, and power distribution systems—components where its unique properties are irreplaceable. Industry analysis suggests that as global data-centre power demand is expected to roughly double by 2026, millions of additional ounces will be locked into hardware that enters recycling cycles only after decades, if at all.

Here’s the critical part: this demand is price-insensitive. For technology companies spending billions on data-centre infrastructure, silver costs represent a negligible fraction of total expenditure. A 30% price increase barely registers compared to the cost of processing delays or thermal failures. Higher prices do nothing to reduce consumption—they only reinforce scarcity pressure.

Five Years of Deficits: A Structural Problem, Not a Cyclical Blip

Silver’s 2026 outlook cannot be understood without grasping the supply-side constraint. The market is entering its fifth consecutive year of annual supply deficit, an unusually persistent imbalance. Since 2021, cumulative shortfalls have approached 820 million ounces—roughly equivalent to a full year of global mining output.

Why can’t producers simply increase supply? Around 70–80% of silver comes as a byproduct of copper, lead, zinc, and gold mining. This means production cannot scale independently of base-metal extraction. A new primary silver mine takes ten years or longer to develop, making the supply curve unusually rigid. Even aggressive price incentives cannot quickly unlock new ounces.

The physical evidence is already visible. Exchange inventories have fallen to multi-year lows. Lease rates have risen, reflecting scarcity. Sporadic delivery stress appears in periods of high demand. Once inventories tighten this much, even modest increases in investment demand can trigger outsized price movements.

The Gold-Silver Ratio Is Flashing a Revaluation Signal

A secondary but important confirmation comes from relative valuations. With gold near US$4,340 and silver around US$66 in December 2025, the gold-to-silver ratio sits near 65:1—a sharp compression from levels above 100:1 seen earlier in the decade and well below the historical range of 80–90:1.

Historically, during precious-metals bull markets, silver outperforms gold as investors pursue higher-beta exposure. This pattern has re-emerged in 2025. If gold simply holds current levels through 2026, a further ratio compression toward 60:1 would imply a silver price above US$70. Past cycles show that silver often overshoots “fair value” when supply is tight and momentum is established. The current setup matches those conditions.

Why $70 Acts Like a Floor, Not a Target

The relevant question for 2026 is not whether silver can reach US$70, but whether it can sustain that level. From a structural perspective, the evidence increasingly suggests yes.

Industrial consumption is sticky—AI infrastructure expansion will not pause because silver costs more. Supply remains constrained by the byproduct problem. Above-ground inventories offer minimal buffering capacity. Once a price level becomes the clearing price for physical delivery, it typically attracts buyers on any weakness rather than sellers on any strength.

This has practical implications. Silver is transitioning from a cyclical trade or inflation hedge into a core industrial commodity with financial characteristics. The repricing appears still in progress. The debate is shifting from “has silver already moved too far?” to “has the market fully incorporated silver’s new role in the global economy?” Current evidence suggests the repricing cycle has further to run.

The Verdict

Silver’s 2026 price forecast is grounded in supply rigidity, not sentiment. With AI infrastructure expanding, inventories depleted, and production unable to respond quickly to demand signals, the market is adjusting to a higher equilibrium. In this context, US$70/oz functions less as a ceiling and more as a new operating base—a reflection of how silver’s industrial utility and scarcity have fundamentally revalued the metal in the modern economy.