The silver market - France

1.2 The global silver market: current situation and main characteristics

Several countries share the world's silver reserves, starting with Peru, which boasts the largest mining potential with ***,*** tonnes of unextracted silver, followed by Australia and Poland.

Countries with the largest silver reserves World, ****, in thousands of tonnes Source: ****

It is noticeable that countries with high mining potential do not exploit their silver reserves in the same way. Indeed, Mexico accounted for the largest share of world silver production in ****, with *,*** tonnes, followed by China and Peru.

Main silver-producing countries World, ****, in thousands of tonnes Source: ****

It is also interesting to note that world production trends are fairly unstable, with growth often offset by years of sharp decline, with production falling by *% and **% respectively in **** and ****.

World silver production World, ****, in thousands of tonnes Source: ****

Global demand for silver has also shown a fairly erratic pattern. The year **** was rather difficult, but the Silver Institute's forecasts were reassuring, with levels in **** exceeding those of ****.

World silver demand World, ****-****, in millions of ounces Source: ****

With the price of silver estimated at an average of **.** USD per ounce in ****[***], it is possible to estimate the world silver market by multiplying this average price per ounce by world demand over the year, which is ...

1.3 The French market

According to the Silver Institute, **.*% of French silver demand was for industry in ****. Assuming that this proportion is constant, it is possible to obtain an estimate of the French silver market by first calculating the industrial silver market in France, which corresponds to the product of demand and the average silver price. According to our initial hypothesis, this sub-market represents **.*% of our total market.

French silver market France, ****-****, in millions USD Source: ****

1.4 International trade

The United Nations database for international trade includes several codes relating to silver. The most important in terms of total quantities imported and exported by France are shown in the following graph. The chart shows that France has a very substantial trade deficit in silver. Indeed, the country's silver exports are clearly negligible compared with its imports, with the exception of a minority of goods such as semi-finished silver metals, for which the volume of imports is similar to that of exports.

Total French silver imports France, ****, in millions USD Source: ****

Let's focus on the most important class, corresponding to commodity code ****: "Silver (***) unwrought or in semi-manufactured forms or in powder form" to get an idea of recent trends in the volume of goods transiting France. Exports show steady growth, with +*% from **** to ****. Imports, on the other hand, are growing less steadily, although the overall trend is still upwards, with more than +**% over the same period.

French silver exports and imports France, ****-****, in millions USD Source: ****

For the same type of goods, the majority of French imports come from European countries, with Germany, Switzerland and Italy accounting for over **% of imports.

Major beneficiaries of French silver imports France, ****, percentage Source: ...

2.1 The main outlets for silver

The Silver Institute's publications provide a breakdown of silver demand by sector, both worldwide and in France. In both cases, most of this demand comes from industry. However, physical investment accounts for a larger share of French demand than of global demand. Jewelry and silver account for a smaller share of demand.

Breakdown of worldwide silver demand World, ****, % (***) Source: ****

Silver demand in French industry France, ****-****, in tonnes Source: ****

2.2 Industrial silver applications

Silver's physical characteristics make it the material of choice for a wide variety of industrial uses. The main areas of application for silver are as follows.

The electronics industry exploits silver's high conductivity (***) As silver is relatively resistant to the chemical activity of bases, mineral acids and alkaline salts, it can be used in chemical equipment. Silver is a good catalyst for carbon monoxide combustion (***). The deposition of a thin layer of silver by thermal evaporation can also be used in the manufacture of mirrors. Silver is a powerful antibacterial, making it suitable for bactericidal applications in the medical field, for example.

However, silver is a material with intrinsic weaknesses, and is therefore often strengthened by forming alloys with other materials.

The addition of copper makes it possible to achieve greater mechanical strength with little alteration to the material's electronic conductivity. This type of alloy is therefore ideal for use in the electronics and jewelry industries. The addition of zinc or cadmium can also be useful if the material's resistance to sulphur and sulphides needs to be increased, as in the case of the manufacture of control rods in the nuclear industry. The ternary silver-copper-zinc alloy is often used in brazing ...

2.3 Integrating silver into the manufacture of electronic components

Most silver used in French industry is used in the electrical and electronics sectors, notably in the manufacture of electrical contacts and catalysts. The French electronics sector therefore plays a major role in the use of silver in France. Indeed, the material's ductility (***), conductivity and malleability are characteristics that are particularly in demand in a context of electronic miniaturization.

The French electronics industry brings together a number of different players: producers of electronic components, connectors and printed circuits, designers and assemblers of electronic boards and sub-assemblies and distributors, as well as publishers of embedded software and software tools for electronic system design.Upstream, the electronics industry is irrigated by a dense network of laboratories, schools and universities in fields of expertise ranging from cutting-edge materials for micro-, medium- and microelectronics, to the most advanced technologies.nano- and optoelectronics, to the creation and development of complex circuit and system design tools.

France can therefore draw on a leading-edge industry in the field of electronic technologies and components, with high R&D intensity and significant added value.most of the industry's activities are international in scope, reflecting its export competitiveness. The design and production of electronic boards and sub-assemblies is also well represented ...

3.1 Production

Today, mining is the principal means of meeting the world's demand for silver. Indeed, according to the following graph, over **% of the world's silver comes from mining production, ahead of recycling, which accounts for over **%.

Sources of world silver supply World, ****, in millions of ounces Source: ****

The following graph shows the evolution of the overall cost of supporting silver mining worldwide. There was a period of decline, with a **% drop in price from **** to ****, followed by a **% increase over the next three years. The year ****, however, brought a small decrease in the price.

Global silver mining costs World, ****, in USD per ounce Source: ****

It's also interesting to note that this price is higher in the Americas, with prices in South and Central America almost triple those in Oceania.

Cost of silver mining World, ****, in USD per ounce Source: ****

3.2 Recycling money

The supply of secondary silver is an important determinant of the silver market. Globally, the recovery of precious metals comes from the resale and remelting of jewelry, the recycling of electrical and electronic equipment, the recovery of dental crowns, and so on.

Although France has not produced silver since the closure of the Salsigne mine in the Aude region in ****, it recycled *.* million ounces of silver in ****, making it Europe's fourth-largest recycler of the material, as shown in the graph below. With the exception of the UK, where the volume recycled increased by more than **% from **** to ****, recycling is fairly stagnant, with a weak downward trend in the early ****s for Italy and France.

The precious metals processing and recycling sector involves around twenty companies, which account for a large proportion of sales.

Silver recycling in Europe Europe, ****-****, in millions of ounces Source: ****

3.3 Jewelry production and distribution

Production

As we saw earlier, jewelry accounts for a significant proportion of silver demand in France. In fact, France is Europe's second-largest jewelry producer, having manufactured **.*% of European jewelry in ****, behind Italy.

Jewelry manufacturing in Europe Europe, ****, % (***) Source: ****

However, French jewelry manufacturing is experiencing a slowly declining trend, with a **% drop in the total weight of jewelry produced from **** to ****, punctuated by a very difficult ****.

French jewelry manufacturing France, ****-****, in millions of ounces Source: ****

Distribution

The following table gives an overview of the distribution channels for silver jewelry.

Source: ****

4.1 Silver price trends

The following graph shows the evolution of the average annual silver price. The price of an ounce of silver depends not only on market supply and demand, but also on economic conditions.the price of silver has risen sharply since the turn of the century, peaking in **** at over $** per ounce, some * times higher than in ****.

Average price per ounce of silver World, ****-****, USD per ounce Source: ****

4.2 Jewellery prices

The following chart shows the average price in different categories of so-called precious jewelry over the period January **** - December ****. While ***% gold is by far the most expensive jewelry category, with an average price of *** euros per piece that year, ***% gold jewelry averages *** euros.

Gold-plated and silver jewelry are the most affordable for households, with average prices of ** and ** euros respectively in ****.

Average price of precious jewelry France, ****, euros Source: ****

Consumer price index for jewelry and watches (***) France, ****-****, index base *** in **** Source: ****

4.3 Selling money online

Numerous websites offer online money buying and selling. These sites offer the following forms of money:

French coins Monnaie de Paris Modern coins coins minted in Australia (***) coins minted in New Zealand minted in Canada Ingots Large volumes of silver (***)

The following table lists the prices of two French silver sales sites in March ****. These sites also offer to buy silver at a lower purchase price than the selling price, but the table details the selling prices.

Source: ****

5.1 Legislation governing silver and precious metals

The mining code was created in ****, taking over from the law of ****. Ordinance ****-** is currently in force. This code requires extractors to hold a mining title, which recognizes the holder's property rights. Several permits are required, from research to extraction, and a special procedure is needed to carry out extraction work. The regulatory body in France is the DREAL (***). A bill to reform this mining code took shape on November **, **** to take better account of environmental issues, the post-mining era and to redefine a national policy on mining resources and uses.

When it comes to trading silver, as with other precious metals, hallmarks and certificates of value and warranty are required. They are governed by the general tax code. Establishments selling silver are also subject to the **** law on the fight against money laundering and the financing of terrorism (***).

Taxation on precious metals changed in early **** with the passage of the **** Finance Bill and its amendment I-CF*** (***). In order to avoid the windfall effect linked to the transformation of the Wealth Tax, concentrated on real estate, taxation on precious metals has been increased, rising from **.*% to **.*% for sales above a value of €*,***. The option of opting for a real capital ...

6.1 Segmentation

• Fresnillo
• Cookson Métaux précieux (Heimerle & Meule Group)
• Gold by Gold
• Aureus
• BullionVault Ltd
• Or.fr