Changes In The Silver Market: Part 1

June 26, 2013

Photographic demand for silver has fallen 70 percent from its peak. What could possibly fill that gap?


[This article previously appeared on and is republished here with permission.]


Back in the good old days, a physical silver trader's dream would be to land a photographic company as a customer.

Polaroid, Kodak, Fuji and many more were on this list of prospects. This industry was a tremendous behemoth in the silver market.

In fact, Kodak was technically in the silver refining business. It had created operations to capture scrap silver as well as to lower its costs of production for their film. One spinoff from the recent reorganization of the company is Rochester Silver Works out of New York. There were also many production sites that grew up in its vicinity. I'm certain it was the same at the manufacturing plants of its competitors as well.

In 1999, the photographic market was to hit its peak of silver production. In the United States alone, according to the U.S. Geological Survey, this market consumed over 93 million ounces. Globally, the photographic industry needed 267 million ounces that year, around 1 silver ounce in every four traded worldwide. So photography carried real buying power as an industry. But the turn of the century was the beginning of the end.

Since 1999, photographic demand for silver has contracted almost 70 percent. I think the reason is obvious to anyone over the age of 23. Children 10 years old in 1999 would surely recall the popularity of film. They would also recall that, in the years of their coming-of-age, photography became dominated by the electronic market. More specifically, the use of digital cameras was to be the demise of silver consumption in this industry.

Recently, statistics point to a dropping demand for digital cameras. But this does not spell growth for the old film industry. Instead it indicates that smartphones are replacing digital camera use.

Still, photographic film remains a big consumer in the silver marketplace. The medical sector uses film primarily for X-rays, and it has held up very well. But don't hold your breath hoping for a resurgence in this sector either. As the new technology becomes cheaper, more and more hospitals and other users of X-ray film will convert to the digital world, too.


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