Silver Above Ground

31 posts / 0 new
Last post
Nick Elway
Nick Elway's picture
Offline
Joined: 06/14/2011
Hat Tips: 4562
Posts: 814
Silver Above Ground

Silver Above Ground at end of 2012 Overview:
Total Silver Mined 3000BC-2012AD:
            49 Billion ounces or 1537000 Tonnes
Irretrievably lost 3000BC-2012AD:
            25 Billion ounces or 789000 Tonnes
Silver above ground end of 2012AD:
            24 Billion ounces or 748000 Tonnes
Nick Elway, Hagarth, and Byzantium helped create this report

Silver above ground is:
  Industrial recoverable at high enough price.
             3 Billion ounces or 93000 Tonnes
             Note 1
  Silver in coins.
           2.5 Billion Ounces or 79000 Tonnes
           Note 2
    Silver in bars and rounds
1.4 Billion Ounces or 43500 Tonnes
            Note 3
    Silver in jewelry and silverware
    17.1 Billion Ounces or 532500 Tonnes
            Note 4

The best work we could find on Silver Above Ground (through 2005) was David Zurbuchen’s 2006 article (22) Zurbuchen’s Overview was

Total Silver Mined 3000BC-2005AD:
     49 Billion ounces or 1537000 Tonnes
Irretrievably lost 3000BC-2005AD:
     25 Billion ounces or 789000 Tonnes
Silver above ground end of 2005AD:
     24 Billion ounces or 748000 Tonnes

Silver above ground 2005 is:
    2005 Industrial recoverable at high enough price.
        4 Billion ounces or 124000 Tonnes
        Note 1
   &nbsp2005 Silver in coins and medallions
        1.2 Billion Ounces or 81000 Tonnes
        Note 2
    2005 Silver in bars and rounds
        1.4 Billion Ounces or 43500 Tonnes
        Note 3
    2005 Silver in jewelry and silverware
        17 Billion Ounces or 499500 Tonnes
        Note 4

Conclusion:
1.Silver is NOT scarcer than gold. If we use the consensus Gold-above-ground number of 166000 Tonnes and our number of 748000 Tonnes, then the ratio is 4.5 silver ounces above ground for every gold ounce above ground. For those that disagree with including silver jewelry and silverware in the silver total, please be reminded gold jewelry IS in the gold total.

2. There is no significant amount of silver in government or banker hands.

3. The more we looked for silver in coins, the more we found.

Note 1) Industrial recoverable at high enough price
Zurbuchen’s estimate in 2005 was 4 billion ounces
This report’s estimate of 3 billion ounces is a guess that higher prices since 2005 made recycling more profitable and reduced the industrial recoverable by 1 billion ounces.

Note 2) This report counts 2.5 billion ounces in coins based on the belief that coins since 1990 have not been melted and that circulated coins from before 1964
In general suffered a 50 per cent melt. The guess of melt is based on asking around at the coin club, where the most common guess was 35 per cent so 50 per cent was chosen to be conservative.
These coins are counted here:
Canadian Circulating 1940-1967(14)
    3208 Tonnes minted assume 50% melted 1604 Tonnes
    Canadian Silver Maple, Olympic, Wildlife 1988-2012 2788 Tonnes
    Indian Rupees(17) 1912-1945
        Minted Rupee - 24,400 Tonnes
        1/2 Rupee - 1,909 Tonnes
        1/4 Rupee - 1,849 Tonnes
         Total 28,158         assume 50% melted 14076 Tonnes
    US 90 percent non-dollar Coins
        Morgan 1878-1921 657 million minted
        -270 million melted Pittman act 1918
   = 387 unmelted
Peace + 190 million = 577 million @24.057 gms
= 13880 Tonnes assume 50% melted 6940 Tonnes

    Dimes, Quarters, Halves 1916-1964, + state proofs
        Minted 2628 Million face @22.5 silver grams/dollar
    59000 Tonnes minted assume 50% melted 29500 Tonnes
    US 40 percent Coins
    Kennedy Halves 65-70 and Eisenhower dollars 71-74
    Minted 819 Million face @avg 9.5 grams per dollar
    7500 Tonnes minted assume 50 percent melted 3750 Tonnes
    US Silver Eagles and ATB 1986-Feb 2013 10844 Tonnes
    Mexican Libertads 897 Tonnes
    Mexican Olympic 25 Peso 436 Tonnes
    Mexican Circulating coins 1918-1987
    10684 Tonnes minted assume 50 percent melted 5342 Tonnes
    Philharmonics 2008-2011 +2012 est 1519 Tonnes
    Britannia 1997-2012 42 Tonnes
    Perth Silver coins 1990-2012 1164 Tonnes
TOTAL IDENTIFIED SILVER COIN ABOVE GROUND SO FAR 78900 Tonnes
THIS DOES NOT INCLUDE ANY ONCE-CIRCULATING SILVER COINS FROM
EUROPE, ASIA ex-India, AFRICA, PHILIPPINES, AUSTRALIA,
CENTRAL AMERICA, or SOUTH AMERICA

Note 3) Silver in Bar and bullion form was not really countable. The number in this report is left at Zurbuchen’s 43500 Tonnes
This may be broken out at the end of 2012 as
    Silver ETP holding(2) 19000 Tonnes
    Comex holding(10) 5000 Tonnes
    LBMA Holdings 2300 Tonnes
    Shanghai holding(10) 34 Tonnes
    Perth Mint allocated good-delivery storage(8) 194 Tonnes
    US Mint storage 19(3) or 220(7) or 489(24) Tonnes
    Identified Total approx 26600 Tonnes
    Unidentified bullion 43500 – 26600 = 16900 Tonnes

Note 4) Silver in Jewelry and silverware is “everything else”, including industrial stocks and any other meltable silver we couldn’t locate.
The USGS Silver statistics table (23) Last updated November 30, 2010 shows industrial stock of 3550 Tonnes at the end of 2009

(1) http://www.cmegroup.com/education/files/cpm-silver-market-lacks-legs-2013-01-28.pdf
(2) http://www.goldcore.com/goldcore_blog/silver-investment-demand-surges-30-silver-etf-holdings-robust
(3) http://www.usmint.gov/downloads/about/annual_report/2012AnnualReport.pdf
(4) http://www.coincommunity.com/us_coin_facts/ and
"2012 North American Coins & Prices" 21st edition Krause Publications
(5) http://www.usmint.gov/mint_programs/atb/?action=mintageTotals
(6) http://www.usmint.gov/mint_programs/american_eagles/?action=sales&year=2012
(7) http://minerals.usgs.gov/minerals/pubs/commodity/silver/mcs-2013-silve.pdf
(8) http://www.perthmint.com.au/pool_allocated_bar_listing.aspx
(9) http://www.perthmint.com.au/investment-bullion-bars-and-coins-mintages.aspx
(10) http://www.investmenttools.com/futures/metals/Base_Metals_Inventory_London_and_Shanghai.htm#comex_silver
(11) http://www.free-bullion-investment-guide.com/austrian_philharmonic_silver.html and http://www.muenzeoesterreich.at/eng/download/annual-reports
(12) http://silverbullionworld.com/britanniamintage.html and
https://www.kitcomm.com/showthread.php?t=108363
(13) http://en.wikipedia.org/wiki/Canadian_Silver_Maple_Leaf
(14) "Charlton Standard Catalogue: Canadian Coins" 67th edition 2013.
(15) http://silveragecoins.com/en/details.php?item=2086
(16) http://typesets.wikidot.com/coin-library-mexico
(17) "Collecting World Coins" 13th edition. Circulating Issues 1901-Present by Krause Publications.
(18) http://www.gold-eagle.com/editorials_05/zurbuchen011506.html
(19) http://minerals.usgs.gov/ds/2005/140/ds140-silve.pdf
(20) http://pubs.usgs.gov/of/2004/1251/2004-1251.pdf
(21) http://demonocracy.info/infographics/world/silver/silver.html
(22) http://www.gold-eagle.com/editorials_05/zurbuchen052006.html
(23) http://minerals.usgs.gov/ds/2005/140/silver.pdf
(24) http://minerals.usgs.gov/minerals/pubs/commodity/silver/myb1-2011-silve.xls

Edited by admin on 11/08/2014 - 06:08

__________________

Nick Elway
Nick Elway's picture
Offline
Joined: 06/14/2011
Hat Tips: 4562
Posts: 814
Typos in Silver Above Ground

Zurbuchen’s Overview was misquoted, should have been:

Total Silver Mined 3000BC-2005AD (22)
        45 Billion ounces or 1384000 Tonnes
Irretrievably lost 3000BC-2005AD:
        24 Billion ounces or 789000 Tonnes
Silver above ground end of 2005AD:
        21 Billion ounces or 748000 Tonnes

I'll fix the original post when editing is enabled.

__________________

Byzantium
Byzantium's picture
Offline
Joined: 02/20/2012
Hat Tips: 8287
Posts: 1526
Great work Nick

When I have some time, I will make reference to other sources for comparison (to put various estimates into context, not least for the purposes of elimination), and produce some graphics to present the above in snapshot form.

Nana
Nana's picture
Offline
Joined: 07/21/2012
Hat Tips: 13219
Posts: 4455
Great Work-Thank You

4.5- to 1 GSR, intersting.

Shouldn't silver be around 22.5% the price of gold then?

Nick Elway
Nick Elway's picture
Offline
Joined: 06/14/2011
Hat Tips: 4562
Posts: 814
re Shouldn't silver price be 22.5% of gold?

@Nana I tend to believe that "should price" of silver as 1/4.5 of gold. Somewhere in this research I believe I read the Hunt brothers thought the fair price of silver was 1/5 of gold's price.

Much of the silver bull's case in the last years has rested on belief in Ted Butler's statements that there was "more gold than silver" and Zurbuchen even wrote a super-bullish article at one time based on believing Ted Butler. His articles that I linked are not kind to Ted Butler. I think that also was the experience of Hagarth, Byzantium, and myself. We started this research as silver bulls trying to verify Ted Butler's assertion. The more we dug, the more silver above ground we found (especially coins).

In terms of what this means for price, hard to say. I'd say all three of us have jumped off the silver super-bull "gonna trade at a premium to
gold" bus.

I am now a believer in "gold is the bankers' and governments' money" and "Silver is the people's money" I believe TPTB can't control silver except through MOPE. The real price will be decided by the buying and selling done by private hands, possibly in private transactions. Today APMEX and my local dealer's wholesaler are paying a premium for "junk". Physical price may be starting to disconnect from Comex price.

Whatever the real answer for Silver (and Gold) Above Ground is, it hasn't changed because we attempted to measure it. What has changed is that I no longer trust the silver super-bulls that argue for some rapid world-changing shortage.

Hungry people will sell their silver to eat. Inflation-fearing people will trade fiat for silver (If they are not hungry). Hard to say what nominal price that will work out to be.

__________________

Hagarth
Hagarth's picture
Offline
Joined: 06/15/2011
Hat Tips: 2182
Posts: 513
@NANA Market Demand

Even with the ratio, which Sinclair says he doesn't use, the VALUE cannot be ascertained simply by above ground stocks. Unless people cannot get their Gold in physical form and believe that the next best metal to buy is silver, the value of the silver is set to industrial prices and market whims.

There may be a time when, due to lack of physical gold on the market, Silver is considered to be the "Go to" metal which could push demand to record levels but realistically I have a hard time seeing this happening. Scotia Mocatta recently did a report for March 2013 .pdf, which did include the monetary relationship of silver and its history as money. Sinclair doesn't want to broach the subject, so be it, but there are Banks that recognize this as a reality.

I surely wish that silver would get to the 4.5:1 ratio, but perception is going to be the real fight to have silver considered as a Safety play, and so far we know that longterm price action has not born this out.

__________________

Suntne vacci laeti.

Nick Elway
Nick Elway's picture
Offline
Joined: 06/14/2011
Hat Tips: 4562
Posts: 814
More silver coin mintage numbers

The more you look for silver coins, the more you find.

This silver-centric site (looks like the author may be from Australia or New Zealand) has silver coin mintage numbers for coins we missed.

(The site bills itself as "The Ultimate Silver Resource" and also has a nice archive of silver-centric articles)

http://www.galeforcesales.com/Silver.php

Bullion coins: Ram Silver Kangaroo and  Armenia Noah's Ark

Once Circulating coins: Australia, New Zealand, British coins 

These coins were not included in our 2.5 Billion Ounce of Silver in Coins Above Ground estimate. 

The site also lists some European, South American, and African coins but has no mintage information on them.

__________________

willsilvaa
willsilvaa's picture
Offline
Joined: 07/25/2011
Hat Tips: 314
Posts: 32
Well Done Nick.....questions from newbie

well 1/2 newbie....typing on backup laptop,not gonna risk trying to change the red colour. I am impressed by your compendium of Ag. Respectfully,did Ted see it? It would be great to have a peer review.Of all people Ted would be most interested in.Imvho. accuracy Wondering...even if there is all the ag bullion around,i think we know nothing about the price it has to go to before people sell it,.Further this ag is spread far and wide ie ,i think upside in percentage is way more for ag,than au...shit get to work Will have a great day

Nick Elway
Nick Elway's picture
Offline
Joined: 06/14/2011
Hat Tips: 4562
Posts: 814
@willsilvaa Has Ted seen it?

Thanks for the nice words.  I haven't tried to get the "Silver Above Ground" to Ted Butler (or David Zurbuchen[reference 22] who called Ted a liar  in 2006).   Ted seems to be doing good work in recent years and I don't want to trouble him.   I just take Ted with large grains of salt.

There are still typos  in my original post of Zurbuchen's results as of 2006:

It should have been:

Total Silver Mined 3000BC-2005AD:
     45 Billion ounces or 1400000 Tonnes
Irretrievably lost 3000BC-2005AD:
     20 Billion ounces or 622000 Tonnes
Silver above ground end of 2005AD:
     25 Billion ounces or 778000 Tonnes

This shows a suspected shrinkage of available silver above ground of 1 billion ounces from 25 to 24 since the end of 2005.  Unfortunately the margin of error is higher than that 1 billion ounces so this isn't enough to confirm or deny that recoverable silver above ground is shrinking. 

I put all those links in to assist anybody that wants to dig further into the silver supply, demand, and stock facts.  If someone puts in some effort I hope they will share the results.

__________________

Nick Elway
Nick Elway's picture
Offline
Joined: 06/14/2011
Hat Tips: 4562
Posts: 814
Ted Butler's just 1B ounces of silver BULLION

http://www.tfmetalsreport.com/comment/302744#comment-302744

Quote:
Every time I've read the Submitted by Turd Ferguson on April 24, 2013 - 8:54am. MODERATOR  Every time I've read the claim of just 1B ounces of silver...from Ted Butler, for example...it is ALWAYS in reference to the available supply of 1000 ounce bars.

Thanks Turd.  Many of the excerpts of Ted Butler articles and Ted Butler quotes  drop the word "bullion" from "just 1 billion ounces of silver bullion above ground"  Many others DO include the word "bullion", so I will assume Ted is referencing bullion (and based on your statement "1000 ounce bars") going forward unless he states otherwise. "Less than 1 billion ounces of silver  in 1000 ounce bars" as a made-up quote doesn't conflict with our findings.

 
Zurbuchen's work implied Ted Butler also dropped the "bullion" qualifier prior to 2005 http://www.gold-eagle.com/editorials_05/zurbuchen052006.html
 
I went to look at the butler research archives http://www.butlerresearch.com/archive-free.asp  but the ones hosted at silverseek seem to have all been replaced by "Iranian" hacks, so no verification there.
 
 
 
 

__________________

lamare
lamare's picture
Offline
Joined: 06/15/2011
Hat Tips: 1110
Posts: 163
Archive.org

Nick Elway wrote:
Zurbuchen's work implied Ted Butler also dropped the "bullion" qualifier prior to 2005 http://www.gold-eagle.com/editorials_05/zurbuchen052006.html
 
I went to look at the butler research archives http://www.butlerresearch.com/archive-free.asp  but the ones hosted at silverseek seem to have all been replaced by "Iranian" hacks, so no verification there.

You may want to check around on archive.org. The oldest copy of the butler archive they have is from 2009:

http://web.archive.org/web/20090807084927/http://www.butlerresearch.com/archive-free.asp

The butlerresearch.com archive goes  back to 1999:

http://web.archive.org/web/*/http://www.butlerresearch.com/

Here's another Butler archive archive:

http://web.archive.org/web/20060820102703/http://www.investmentrarities.com/tb-archives.html

These  articles appear to be the ones you are looking for:

http://web.archive.org/web/20090829234259/http://www.investmentrarities.com/ted_butler_comentary/07-12-05.html

http://web.archive.org/web/20090831213400/http://www.investmentrarities.com/ted_butler_comentary/08-02-05.html

http://web.archive.org/web/20060820072905/http://www.investmentrarities.com/11-13-00.html

Newager23
Newager23's picture
Offline
Joined: 06/13/2012
Hat Tips: 632
Posts: 30
Silver Supply versus Gold Supply

Nick,

Thanks for posting about the forum. Again, I think you are looking at this wrong. My analysis is that from a dollar inventory level perspective, there is 100x more gold than silver. $10 billion versus $1 trillion.

I think my numbers are +/- 50% accurate.

I question your totals of 24 billion oz of silver above ground. I used 15 billion in my analysis, which is probably a bit low. But your estimate of 1.2 billion coins seems high to me (most of the coins that have been minted over the years have been lost). I estimate this closer to 500 million oz.

And your estimate of 1.4 billion oz of bars seems inflated. Most of these bars have been melted down in my opinion for electronic devices and automobiles. Notice the dearth of inventory on the Internet.

Even if I am wrong by 50% and there is 22 billion oz of silver above ground, there is no where near as much silver  inventory versus gold on a dollar basis.

Your analysis that there is more silver than gold  pre-supposes that people will sell their jewelry and silverware and swamp the retail level with inventory. Most of the jewelry and silverware is not .999 pure, not even close. They are not going to get spot price, not even close. The jewelry and silverware that is recycled will be blip on the inventory levels. Remember, we are mining 800 million oz a year. And that is still not enough to create any inventory. Do you think recycled silver is going to double to 400 million oz? I doubt that. We could get another 50 million oz a year of recycled, but like I said, that is a blip on a dollar basis.

What is going to happen is that people (and manufacturers) are going to want silver, and there simply is not very much of it (on a dollar valuation basis) for sale. $10 billion is pocket change on a global scale.

When you compare gold to silver on an dollar valuation basis, the difference is staggering (100 to 1, or perhaps 50 to 1). If a rich guy walks into his local coin shop, he can buy all of the silver with folding money (cash) -- any LCS in America.

Note: In the next edition of my book: How to Invest in Gold & Silver, I am going to increase the above ground silver inventory because of your post. You can find information about my book on my website: www.goldsilverdata.com.

Regards,

Newager

Nick Elway
Nick Elway's picture
Offline
Joined: 06/14/2011
Hat Tips: 4562
Posts: 814
Unfortunate Ted Butler commentary from August 2005

@newage   I was hoping for some useful references or other verifiable information in your post.  Instead it appears you are channeling this unfortunate Ted Butler post from 2005.

http://www.investmentrarities.com/ted_butler_comentary/08-02-05.html

(thanks again to lamare for finding the archived copy so I could see what Ted really did say)

Quote:

Maybe a table will help –

Above-ground Inventory (billions of ounces)

                                                                              World

                                                                          Population

Year                                 Gold         Silver      (Billions)

1940-50                     2                  8-10            2..5

1980                           3.5               3.5              4

2005                           5                   1                 6

2030(est.)                  7                   0 -1             8

(Inventory statistics taken from World Gold

Council, the Silver Institute, and others

Population data from US Census Bureau)

Notice that 60 years ago, there was roughly 5 times more silver than gold above ground. Today, there is 5 times more gold than silver. Twenty-five years from now gold’s inventory will climb by 40%, based upon expected production rates, roughly equal to projected world population growth. Silver, on the other hand, will experience no growth in inventories, unless prices explode to extraordinary levels. About the surest thing we can say about silver inventories is that they can’t fall below zero.

Please keep in mind that the gold and silver inventories I’m talking about include bullion, coins, jewelry and artifacts that could possibly come to market near current prices. In other words, real inventories. Additionally, while silver is mined at a rate 7 to 8 times more than gold, none of that production finds its way into inventory (thanks to the deficit), while almost all gold production is added to inventory.

I started the research on this forum because I wanted to find the  substance behind Ted Butler's claim  of more gold than silver above ground.  (As you can see, he was referencing bullion+coins+jewelry+artifacts that could possibly come to market at near current prices.)  Digging at the Silver Institute for silver above ground answers was unproductive.    I like Ted Butler's work in general, but I can find no evidence his claim has merit.  Zurbuchen's work, on the other hand, can be checked.

Hagarth and I found good information on coin mintage and I took the question of "how much was melted" to my large local coin club.  The greybeards were shocked that I would suggest 2/3 (of the coins produced since 1916) was melted.  Most of them were in the 1/3 melted range and we used 1/2 melted because that was the highest estimate I got from an elder at the coin club.  The most common response I got to "how much is still around?" was "a lot"  When I said I was trying to find a real reference I could trust these guys said "good luck finding anything" The "at least 2.5 billion ounces of silver in coins" is a conservative  and defendable estimate.

The 1.4 billion ounces in bars and rounds is straight from Zurbuchen  and we found no decent way to verify or refute Zurbuchen's number.  Given the excellent and verifiable work he did in general makes me trust his bullion number  (from 2004).  This is just trust, so

http://www.safehaven.com/article/4688/the-silver-deficit-1942-2004

If you have anything more substantive or verifiable than "I think my numbers are +/- 50% accurate." or "seems inflated" or "probably lost" I welcome it.

We came up with 4.5 ounces of silver for every ounce of gold (under the Butler conditions of bullion+coins+jewelry+artifacts that could possibly come to market at near current prices) With a 60:1 GSR /4.5 then the fiat value of that gold is 13.3 X the fiat value of that silver.

People (but not governments and central banks) are spending equal amounts of fiat on physical silver and physical gold, so in my opinion our findings are still bullish for silver  compared to gold, just not as bullish as the "less silver than gold" hype would have us believe.  

__________________

Nick Elway
Nick Elway's picture
Offline
Joined: 06/14/2011
Hat Tips: 4562
Posts: 814
tmosley writes

http://www.tfmetalsreport.com/comment/322421#comment-322421

tmosley's picture

Nick: Looking some more at

Nick:

Looking some more at your numbers, it appears that you took the assumed amount of above ground silver (25 billion oz as of 2005) and broke it down into categories:

2005 Industrial recoverable at high enough price.
        4 Billion ounces or 124000 Tonnes
        Note 1
  &nbsp2005 Silver in coins and medallions
        1.2 Billion Ounces or 81000 Tonnes
        Note 2
    2005 Silver in bars and rounds
        1.4 Billion Ounces or 43500 Tonnes
        Note 3
    2005 Silver in jewelry and silverware
        17 Billion Ounces or 499500 Tonnes
        Note 4

These categories do not add up to 25 billion oz.  Further, Note 4, which I found suspicious (I would not expect to see so much silverware given that almost all of that was devoured by Hunt Bros and Co).  Checking the link, I find a website talking about coins.  I don't see anything about jewelry or silverware.  Please advise or update your source. 

__________________

Nick Elway
Nick Elway's picture
Offline
Joined: 06/14/2011
Hat Tips: 4562
Posts: 814
Silver above ground 2005 numbers updated

Thanks Tmosley for your comments.

The best resource I could find for 2005 was

http://www.gold-eagle.com/editorials_05/zurbuchen052006.html

My attempt to summarize zurbuchen's results had typos and other problems.  Zurbuchen came up with 21 billion ounces 3 different ways and they all excluded industrial recycling that would occur if silver's price went above $50 an ounce.  He threw in an additional 4 billion ounces of potential recyclables to make his total 25 billion ounces.

One of his ways to get to 21 billion ounces was the CRA Report

Quote:
Back to the CRA Report.

Here’s what it had to say about how much silver remained in 1992:

Total Silver that remains above-ground (all forms): 19.06 billion ounces

Total Silver contained in silverware and art forms: 16.48 billion ounces

Total Silver contained in bullion form: 1.40 billion ounces

Total Silver contained in coin and medallion form: 1.18 billion ounces

Updating the CRA Numbers

During the period 1992-1994: World mine production of silver totaled 1.373 billion ounces (Minerals Yearbooks).

During the period 1995-2004: World mine production of silver totaled 5.639 billion ounces (The Silver Institute).

During 2005 (Partial): World mine production  of silver in 2005 totaled 527.3 million ounces (CPM Group – Silver Survey 2005).

Total World Mine Production from 1992 to 2005 = 7.54 billion ounces

Combining this number with the CRA Report’s estimated total above-ground supply of 19.06 billion ounces, we arrive at 26.6 billion ounces of silver remaining above ground. 

Since 1992, the world has used nearly 8.1B ounces of silver industrially, but has only returned 2.4B ounces as old scrap.  Assuming that 90% of the old scrap had its origin in recycled industrial materials, this leaves us with a total of just 20.66B ounces [26.6 – (8.1B – (2.4 x 0.90)] remaining above ground.  This number is strikingly similar to our 2 other separate findings of 21.44B ounces and 20.86B ounces. 

By taking the average of all three, we arrive at 20.99B ounces of silver remaining in the world in all forms (mostly jewelry and silverware).

But in order to temper our enthusiasm in discovering what would actually be a relative rarity ratio between gold and silver of less than 1 to 5 based upon the above numbers, let us further assume that a maximum of 4 billion ounces of silver could be recycled from existing industrial (not including jewelry or

sterlingware) materials if the price were right (say $50-$100/ounce).  Including this additional potential supply, 24.99B ounces of silver would remain in all forms.

If one scales the 1992 numbers to 2005 (it seems that is what zurbuchen implies)

Total Silver (as of 2005) that remains above-ground (all forms): 25 billion ounces

Total Silver contained in silverware and art forms: 18 billion ounces

Total Silver contained in bullion form: 1.60 billion ounces

Total Silver contained in coin and medallion form: 1.3 billion ounces

Total Silver that could be recycled as silver price climbs through $50/ounce into triple digits: 4 billion ounces.

My main complaint with zurbuchen is that his silver in coins amount is low, even for 2005.  We got to 2.5 billion ounces in silver coins without including once-circulating silver coins from Europe, Asia ex-India, Africa, Philippines, Australia, Central America, or South America.

Regarding Tmos specific questions:

Quote:
These categories do not add up to 25 billion oz.

adjusted above

Quote:
 Further, Note 4, which I found suspicious (I would not expect to see so much silverware given that almost all of that was devoured by Hunt Bros and Co).

  I don’t see any link or reference to substantiate Tmosley assertion that the Hunt Bros and Co devoured almost all of that silverware.  I would hope that any readers with something verifiable to add would post in the Silver Above Ground forum.

Quote:
 Checking the [Note 4] link, I find a website talking about coins.  I don't see anything about jewelry or silverware.  Please advise or update your source. 

Here is Note 4

Note 4) Silver in Jewelry and silverware is “everything else”, including industrial stocks and any other meltable silver we couldn’t locate.
The USGS Silver statistics table (23) Last updated November 30, 2010 shows industrial stock of 3550 Tonnes at the end of 2009

The only link in note 4 is (23) where industrial stock of 3550 tonnes is justified.

If the problem is disbelief in the preponderance of silver in jewelry and silverware

Reference (1) (from the cmegroup)

Quote:
Approximately

90% of the 27 billion ounces of above-

ground stocks is held by individuals in the form of jewelry, silverware, and

decorative objects.

Reference (22) zurbuchen had 86 percent in 1992

The more we looked for silver, the more we found.

__________________

Strongsidejedi
Strongsidejedi's picture
Offline
Joined: 06/14/2011
Hat Tips: 11801
Posts: 2281
Some random thoughts of appreciation and further analysis

To the guys researching "above ground silver" quantity, thank you very much for posting your intriguing analysis.

In fact, your work is superb.

I've been thinking about the above ground silver supply in the context of collectible numismatic coins.  Are these coins really rare or not...are these coins really silver at 85%  or 90 % or 95% (i.e. Roman empire debasement of currency)?

Earlier this year, we were on main street discussing the gold/silver ratio and the issue of silver mine production.  The Kennecott mine in Utah had just avalanched and we were attempting to evaluate the impact of the mine's absent production on gold and silver prices.

I reached the conclusion that the mine would impact the available US supply of silver and to a lesser extent gold.  Another contributor to this blog pointed out the issue of industrial versus monetary use.  They pointed out that the monetary use of silver was dwarfed by the industrial demand.

I've wondered how much industrial silver actually gets reclaimed and how much is lost into the city dump when old electronics and circuit boards are sent to the garbage heap.

Nick Elway
Nick Elway's picture
Offline
Joined: 06/14/2011
Hat Tips: 4562
Posts: 814
Industrial silver reclaimed versus dumped

@Strongside, thanks for your kind words and your interesting questions.

Regarding your "I reached the conclusion that the mine would impact the available US supply of silver and to a lesser extent gold."

Your conclusion must be true,  but is it a significant impact?  In 2012 Silver the US mined 1050 Tonnes, imported 5300 Tonnes, recovered 1500 Tonnes from scrap, and had 750 Tonnes (miraculously created?)  in the Refined/Primary category.

I get this from:

http://minerals.usgs.gov/minerals/pubs/commodity/silver/mcs-2013-silve.pdf

Quote:

SILVER
(Data in metric tons1 of silver content unless otherwise noted)
Domestic Production and Use: In 2012, the United States produced approximately 1,050 tons of silver with an estimated value of $1.01 billion.  (snip)

There were 21 U.S. refiners of commercial-grade silver, with an estimated total output of 6,500 tons from domestic and foreign ores and concentrates, and from old and new scrap. (snip)

In 2012, the estimated uses were electrical and electronics, 35%; coins and medals, 25%; photography, 10%; jewelry and silverware, 8%; and other, 22%.
Salient Statistics—United States:  2011 2012e
Production: 1,120 1,050
Refinery: Primary  790 750
         Secondary (new and old scrap)  1,710 1,500
Imports for consumption2  6,410 5,300
Exports2  904 1,200
Consumption, apparent  7,910 5,900
Net import reliance7 as a percentage
of apparent consumption  64 57
Recycling: In 2012, approximately 1,500 tons of silver was recovered from new and old scrap.
Import Sources (2008–11):2 Mexico, 51%; Canada, 23%; Peru, 6%; Poland, 6%; and other, 14%.

One way I can get the USGS apparent consumption total is mined (1050) PLUS primary refined (750) PLUS imported for consumption (5300) MINUS exported (1200) equals apparent consumption (5900)  (ignores recycled)

These numbers don't jive for me because what were the refineries (primary) refining if it didn't come from mines or imported ore? For now I'll call those 750 Tonnes miraculous.

I have no clue about the tonnes of silver above ground in pre-1916 coinage (except for Morgans we counted it as zero)

It was a challenge trying to get a verifiable handle on silver stock or flow.  We made some headway on government coins (no headway on outside-the-system bars or rounds, we were back playing "a wise man once said")  If you find any verifiable information please put it in this forum. 

Getting decent answers is a lot like work.

Looking at infographics about urban mining/recycling is more fun: http://www.silverdoctors.com/mining-your-iphone-for-gold-silver-the-infographic/#more-24367

__________________

Strongsidejedi
Strongsidejedi's picture
Offline
Joined: 06/14/2011
Hat Tips: 11801
Posts: 2281
kennecott mine output

From: http://kennecott.com/operation

"As the second-largest copper producer in the United States, Kennecott provides nearly a quarter of the country’s copper needs. Throughout its history, the Bingham Canyon Mine has produced more copper than any other mine — more than 19 million tons.

In addition to producing about 300,000 tons of copper a year, the Bingham Canyon Mine also produces approximately 400,000 ounces of gold; 4 million ounces of silver; 30 million pounds of molybdenum; and 1 million tons of sulfuric acid annually."

4 M ounces is about 110 metric tonnes.

The answer to your question about "Significant" in my opinion is YES.

Losing 10% of your domestic silver production is a significant impact.

That was BEFORE the fall in silver price to current levels.

There are likely more silver mines that are out of production as the crude oil price has gone parabolic up and the silver price has gone down.

The crush between limitations on the mines means that the recycling of silver becomes a preferred way to locate silver for industrial use.

My guess is that the silver recycling people are doing much better.

¤
¤'s picture
Offline
Joined: 06/14/2011
Hat Tips: 92321
Posts: 18245
My $.05 worth

Interesting facts and a cool thread Nick. yes 

That's a lot of potentially recoverable silver.

Platinum and palladium are other interesting recoverable metals. The automobile industry uses tonnes of the stuff every year in catalytic converters.

Just imagine how much P&P is driving around at any given time...or laying around in a junkyard etc.

Someone with mad math skills and the ability to look up automobile sales statistics  over the years could probably roughly come up with a tonnage or ounces calculation of available above ground P&P.

I don't own any platinum...but I'd like to.

__________________

An epic lack of foresight, accuracy and humility over 3 1/2 years ago. Once a pumper, always a pumper!
http://www.tfmetalsreport.com/comment/170246#comment-170246

Nick Elway
Nick Elway's picture
Offline
Joined: 06/14/2011
Hat Tips: 4562
Posts: 814
@Strongside silver supply

Thanks for the numbers.

10 per cent of domestic mine production, 4.3 per cent of domestic mine + recycle

You'd think the mines not being able to mine profitably would have SOME impact.

Recycling old electronics for silver ain't cheap (not like silverware and jewelry) so I'm thinking all the electronics is just piling up, waiting to come out when the price justifies it. 

I fear that as  the depression goes on (and EBT cards become worthless)  silver jewelry and silverware  (zurbruchen estimated these made up 86 percent of above-ground-silver in 2005) will be a growing source of silver supply  as desperate people trade them for food and gas.   I hope I'm wrong.   

__________________

That_1_Guy
That_1_Guy's picture
Offline
Joined: 01/14/2013
Hat Tips: 1579
Posts: 250
Great thread. I have been thinking.

Great analysis Nick, SSJ and Hagarth.

Just for the record, silver is my favorite. It always has been more appealing to me than gold...even as a child when I started collecting.

I was contemplating this idea for the last couple of months and wanted to give it a pass by you gentlemen. Kinda like a sounding board…

I’m going to give it a shot to explain my thoughts starting point short and concisely. I couldn’t think of a better group to talk this through….so, I guess investigating another perspective theory here. I am sure it is not complete, but wanted to explore here.

My theory here is that there is plenty of Silver (and Gold); however, notes of credit issued on behalf of real (gold and silver) money as defined by CA1792 (in this case USD) have not been fairly tallied and the devaluation of that currency/credit note has been suppressed on superior (in my opinion, falsely instilled)“confidence”.

I’m not sure, I said that right…ill try simpler. Dollars are worth far less than people realize. Through this false confidence, all commodities are suppressed in price; including, metals, food, fuel, water and just about any other commodity that you could think of (SSJ). I know that it is commonly agreed that 95+ % of the purchasing power of the dollar has been lost since 1913. I believe that number is far too low.

I started my current contemplation on the valuation of silver as defined in the Coinage act of 1792 (thanks silver66).

http://en.wikipedia.org/wiki/Coinage_Act_of_1792

According to this the definition is 1$ USD is equal to 24.1 g pure silver.

Dollars or Units

$1

371 4/16 grain (24.1 g) pure or 416 grain (27.0 g) standard silver

I first looked at the amount of dollars initially circulated in 1792. To my surprise, it wasn’t readily available to see how many dollars they issued in 1792. I haven’t found it still. ( Between work and family I don't have a ton of time, so i figured a shortcut)

What I did was improvise, based on your research here Nick and Co. I couldn’t find out what was issued then, but I can extrapolate what is issued now.

So lets assume that we generously have 35 billion ounces of silver above ground currently (I think there’s less than 5 and that gold is much more readily available in vaults, than silver).

Lets conservatively assume that there is 150 Trillion of USD created through issuance, obligations and derivatives (I think there’s closer to a quadrillion USD). Under CA1792, they define the gold to silver exchange rate as 15 ounces of silver to every ounce of gold. So lets assume that’s 10 trillion in silver dollar collateral.

So what we have here is 35 billion ounces x 31.1 grams / by 24.1g as defined in the CA1792 = the dollars that can be collateralized by silver as defined in the CA1792

45 Billion dollars backed by silver (in this scenario)

Cause my hand gets tired from entering too many 0s on trillions billions etc, I’m going to short hand.

10,000 Billion (10 trillion) currency issued, promised or bet / 45 Billion in physical silver to back it = 222.222 current dollars per CA1792 silver dollar equivalent. Reverse engineered, silver would be that price if numbers are accurate that calculated the ratio.

I also assume that they cant let this happen because if it does, ALL other commodities that they subsidize would go parabolic in tandem.  

I don’t want to muddy the waters of creativity by painting the whole picture, but this was the starting point where I realized that its all just a sham game. No slaves needed when all are paid in paper….ahhhh.

This is one piece of a much bigger story that I just dont have time to unfold yet. Additionally, if i did it would be a hell of an elephant to eat in one bite.

Dinner time...comming dear.

Thoughts appreciated.

Guy.

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Topic locked
Syndicate contentComments for "Silver Above Ground"