World silver mine production rose to a record high in 2005 at 641.6 million troy ounces.

Total world demand for silver rose to 864 .4 million troy ounces in 2005.

• The growth in electrical and electronics usage in 2005 amounted to a 10% increase over the previous year.

• Demand in the silver jewelry and silverware sectors increased in 2005 with China accounting for a 20% uptake to 16.4 million troy ounces and Indian demand increasing to 48.9 million troy ounces, a rise of 8.5%.

• Photographic demand fell by 16 million troy ounces to 164.8 million troy ounces, a drop of 19% with silver coins and silver medal production also registering a fall of 4%.

• Recycling of old and new scrap accounts for a substantial amount of silver becoming available annually.

About 75% of mined silver production is a by product of copper, lead, zinc and gold mining and as a consequence silver production continues at a similar level irrespective of price changes and demand for the metal.

As industrial demand and prices for base metals increases so the exploration and development of new mines will also gather pace with the consequential increase in silver production in most cases remaining a by product.

It is understood that there are many known silver deposits and reserves that can come on stream when silver prices are considered high enough to make the extraction viable.

Profits from mines that solely produce silver are at more risk than those mines that produce silver as a by-product as they are entirely reliant on silver price and demand.

In modern times silver was not considered as a primary source of value whereas the demand for gold continued to be for financial reasons, whether held as coin, bullion or jewelry with only a relatively small amount being used up and becoming irretrievable.

Commercial usage of silver, particularly in the fast developing hi tec industries, is increasing and much of the metal used becomes irretrievable.

At the same time silver has become more easily tradable by the investing public. One such recent development has been the launch of Barclays silver exchange traded fund (ETF). Currently this ETF has over 92 million ounces of pure silver in the fund.

In 1980 the price of silver hit a high of US$ 48.70, about $120.00 adjusted to todays dollar value when there was an attempt to corner the market. This is not far off ten times as much as the current price.

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