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China isn’t buying silver from specific mines but rather securing large quantities from producing nations like Russia and South America, while simultaneously restricting its own silver exports to control supply, especially for clean energy tech like solar panels and EVs, making them a major buyer from the global market, not just specific mines. They’re buying aggressively from Russia, for instance, and negotiating directly with South American producers, aiming to control a crucial resource for modern industry, reports CNBC, Mining.com and Jerusalem Post.
Where China is sourcing silver:
- Russia: China has significantly increased its purchases of Russian gold and silver, with sales hitting $1 billion recently, according to Mining.com.
- South America: Chinese entities are engaging directly with South American producers, showing a strategic shift to secure physical supplies.
- Global Market: Through large trading firms and manufacturers, China is competing in the open market, even offering above-market prices for immediate supply, reports CNBC.
Why China is buying so much:
- Clean Energy Demand: Silver is essential for solar panels (around 20g per panel) and electric vehicles (25-50g per EV), and China aims to control this critical metal for its green transition, notes Morningstar.
- Strategic Control: By controlling silver supply, China can influence global manufacturing and defense supply chains, making it a strategic asset, says Trading Economics.
China’s export restrictions:
- Starting January 1, 2025, China implemented tighter controls on silver exports, effectively hoarding the metal and reducing global availability, reminiscent of its strategy with rare earths, according to reports from CNBC, Morningstar and Trading Economics.