You’re Buying Silver Coins, Bars, and Rounds, but Where Does it Come From?

silvermine1sm

Each day investors and collectors are snatching up hundreds of thousands of ounces of silver around the globe. These silver precious metal products come in many shapes and sizes, from popular silver bullion coins and bars to silver rounds and unique statues. The one thing these all have in common is their metal content. Modern bullion and collectible silver precious metals feature at least .999 pure silver content, if not .9999 pure silver.

While you purchase many of these items from authorized dealers such as JM Bullion or directly from mints around the globe, these are not the sources of that silver. So the question is, do you know where your silver originates? The answers might surprise you. Take a look with us at the major sources of silver in the US and around the world today.

Top 10 World Producers

Silver prices have enjoyed new heights in the 21st century for a variety of reasons. Silver spot prices rise and fall each day, and over time, as a result of market factors that impact fiat currencies. Typically, when the US dollar and other global currencies struggle and dip, investors turn to silver and gold in droves to protect their wealth against market fluctuations. Another major pressure point for silver is its demand in jewelry, electronics, energy, automotive, and electrical industries.

Recently, industrial demand has been driving modest gains (and general stability, for the moment) in silver prices. Producers around the globe continue to mine silver to meet these various demands, including for precious metal investors. Roughly 30% of the annual supply of silver comes from mines primarily dedicated to silver sourcing. More than one-third of global silver production comes from mines that primarily run lead and zinc operations, with silver found as a byproduct of that search. An additional 20% of global silver annually sourced comes from copper mines.

Today, just over two-thirds of the world’s silver sources come from polymetallic ore deposits being mined around the globe. We’ll get to that other third later, but for now, let’s look at the top silver producers around the globe based upon ounces (in millions) found as of 2016:

  • Saucito, Mexico: Saucito is a primary silver mine and the largest silver operation in the world. It churned out 21.95 million ounces of silver in 2016.
  • Escobal, Guatemala: Escobal is the world’s second largest silver operation and produced a personal record of 21.2 million ounces in 2016.
  • Dukat, Russia: The largest silver mine in Russia, Dukat saw a 12% drop in 2016 to 19.8 million ounces of silver produced.
  • Cannington, Australia: Cannington is a lead-zinc-silver operation, but has long been the top producer in the world until recently. It produced a world record 44 million ounces of silver in 2005, but just 18.24 million ounces in 2016.
  • Antamina, Peru: Antamina is a copper-zinc-molybdenum-lead-silver operation that produced 18.07 million ounces in 2016.
  • Penasquito, Mexico: Mexico’s largest gold producer, this polymetallic mine sources gold, silver, lead, and zinc and produced 17.90 million ounces of silver in 2016.
  • Uchucchacua, Peru: The highest-grade silver mine in the top 10 and seventh biggest operation in the world, the silver, zinc, and lead operation here churned out 16.21 million ounces in 2016.
  • Fresnillo, Mexico: Fresnillo is not just the eight largest silver producer in the world, it is one of the oldest continuously operating mines with operations at the site dated as far back as 1554. In 2016 it produced 15.87 million ounces of silver.
  • Pirquitas, Argentina: Using unique gravity pre-concentrators prior to processing in conventional mineral flotation plants, Pirquitas sourced 10.42 million ounces in 2016.
  • Garpenberg, Sweden: The oldest mine still operating in Sweden, recent expansions and improvements at Garpenberg have made it one of the world’s most cost-effective mines with 9.71 million ounces of silver produced in 2016.

US Silver Sources

You no doubt noticed the absence of US silver mines on the above list of the world’s top producers. So, where does the United States get the silver it uses in various industries and in the production of silver coins from the United States Mint? Well, traditionally the United States got a jump start on its silver industry with the discovery of the Comstock Lode in Nevada in 1858.

Today however, Alaska is the nation’s leading source of silver. There are two primary mining operations in Alaska that provide the US with the vast majority of its silver, even though Nevada remains second and Idaho in third. Alaska’s two contributions come from:

  • The Greens Creek Mine near Juneau produced 8.452 million ounces of silver in 2015, and 3 million ounces of silver in 2016.
  • Red Dog Mine is the world’s largest source of zinc, but also produces silver in massive amounts as a byproduct of lead and zinc production. 7.56 million ounces of silver came from this mine in 2014.

Another major source of silver, and gold for that matter, comes from recycled electronics in the United States. With millions of smartphones and tablets produced annually by the likes of Samsung, Apple, and others, consumers in the United States are increasingly responsible in the end-of-life disposal of their electronic devices. Currently, there are more than 320 tons of gold and more than 7,500 tons of silver used to produce new electronics around the world each year.

The result of that effort is more than $21 billion in precious metals inventoried inside of devices we use every day. There is an estimated $16 billion in gold and $5 billion in silver wrapped up in electronic devices just waiting to be harvested during the recycling process. Modern recycling facilities for e-waste, such as those in the United States, con recover upwards of 95% of gold and silver found in any given device. Developing countries use crude dismantling processes and often harvest only 50% of precious metals inside.

There are roughly 4.4 million tons of electronics in the end-of-life stage in the United States which are recycled each year. This source of silver and gold is much richer than mineral extraction through mining. According to the Institute of Scrap Recycling Industries, ISRI, one metric ton of computers and e-waste can provide as much gold for extraction as 17 tons of ore. Companies are catching on and cashing in on recycled e-waste too. You’ll recall that in April 2016, Apple announced it had recovered more than 2.204 lbs of gold during 2015 electronics recycling operations, which had a value of roughly $40 million.

Stick with JM Bullion

From fun and informative news posts to introductions for new coin series and designs, our blog at JM Bullion is designed to keep you in the know and pique your interest on all things silver, gold, platinum, and palladium. Check our blog weekly for new posts or follow us on Facebook to find out the moment new posts go live!

All Market Updates are provided as a third party analysis and do not necessarily reflect the explicit views of JM Bullion Inc. and should not be construed as financial advice.