Silver ended April at $38.20 per troy ounce, a gain of 9.4% for the month — more than one and a half times the 6.1% advance recorded by gold over the same period. The outperformance narrows the gold/silver ratio from 95 to 91, a level last seen in early 2024 and a potential signal that industrial users are competing meaningfully for available supply.
The primary driver is solar. Global photovoltaic capacity additions are tracking toward a record 620 gigawatts in 2026, according to BloombergNEF, and each gigawatt of solar capacity requires approximately 20 tonnes of silver for cell metallization paste. That implies solar manufacturers will consume roughly 12,400 tonnes of silver this year — about 15% of total annual mine production.
The Silver Institute's latest demand report, released mid-April, revised its full-year industrial consumption forecast upward by 7% to 680 million ounces. Fabrication demand from the electronics sector, which uses silver in printed circuit boards, semiconductors, and contacts, also rose 4.3% in the first quarter as the AI hardware build-out accelerated spending on server infrastructure.
Physical tightness is increasingly evident in the lease rate market. Silver lease rates — the cost of borrowing silver for short-term industrial use — spiked to 2.1% annualized in mid-April from 0.4% at the start of the year, signaling that above-ground stocks are being drawn down. COMEX silver inventories fell 8% over the month to 284 million ounces, the lowest level since October 2024.
Investor positioning has amplified the move. Managed money net-long positions in COMEX silver futures increased by 18,000 contracts in April, according to CFTC Commitments of Traders data. Simultaneously, silver ETF holdings globally rose by 45 million ounces to 850 million ounces, erasing the outflows seen in the second half of 2025.
Supply constraints are also a factor. Mexico, the world's largest silver-producing nation, reported a 3.2% decline in output for Q1 due to lower ore grades at the Fresnillo and Penasquito mines. Peru, the second-largest producer, faced production disruptions from community protests at two major operations in Junin province.
Against this backdrop, silver's dual role as both a monetary asset and an industrial input gives it an asymmetric demand profile. When gold rallies on safe-haven flows, silver typically follows. When industrial activity is strong, silver benefits additionally from fabrication demand. Both conditions currently apply, which explains the sustained outperformance relative to gold.
The critical technical level for silver is $40, a psychological threshold that has served as resistance twice since 2021. A close above that level on significant volume would likely trigger momentum-driven buying from systematic funds. To the downside, $35 represents strong structural support where physical buyers have historically emerged.