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Posted on 12/26/2025 7:24:00 AM PST by delta7
China’s relentless silver buying at record prices, a record SHFE spread, and 2026 export controls confirm silver has become the decisive industrial, economic, tech, and military weapon
Physical silver buying in China is continuing at full speed even as silver marks fresh all‑time highs, and that persistence is the tell. What is unfolding is not a normal commodity cycle; it is a quiet arms race for the metal that powers the modern world.
Silver buying doesn’t care about price.
China’s silver demand has only intensified as prices have exploded, with Shanghai spot and near‑dated SHFE futures trading at persistent premiums to London and New York. That premium is arbitrage’s way of screaming that real metal in China is worth more than Western paper promises.
Silver is a critical input for solar, electronics, EVs, data centers, AI hardware, medical devices, drones, and precision weapons, and Chinese manufacturers cannot simply “opt out” when prices rise. For tens of thousands of factories, silver is a tiny share of the finished product’s cost, so they buy regardless and pass the higher input cost on to the end user.
Spot–SHFE spread snaps
In recent months, China’s basis and futures curve have repeatedly blown out, with SHFE silver trading at record levels and a rich premium over LBMA prices. Rising open interest and backwardation on the SHFE curve show this is not a one‑off squeeze, but a crowd of domestic players leaning hard into physical‑anchored prices.
That widening gap between Western spot and Chinese prices is the market’s split screen: paper markets marking time in New York while Shanghai bids up metal needed for factories, power grids, and weapons systems. When spreads get this extreme, silver naturally flows toward the highest, most reliable buyer—and right now, that is China.
January 1, 2026: export door slams
Beijing has now formalized its strategy: from January 1, 2026, silver exports fall under strict state‑trading controls and licensing through at least 2027. Exporters will need Ministry of Commerce approval, and only large, state‑sanctioned producers meeting high output thresholds will even qualify, effectively ring‑fencing more domestic mine supply for internal use and stockpiling.
This is not a random regulatory tweak; it mirrors China’s earlier playbook in rare earths, tungsten, and other strategic materials—tighten exports, secure domestic supply, and turn a raw material into geopolitical leverage. Once these curbs begin, the West will no longer be able to count on emergency silver shipments from China to bail out London or COMEX during a squeeze.
Silver as a 21st‑century weapon
Whoever controls the most silver will not just dominate jewelry or coins; they will anchor four pillars of power:
Industrial power – Silver is indispensable for high‑efficiency solar cells, advanced semiconductors, sensors, and precision manufacturing. Economic power – By controlling export flows and stockpiles, China can tighten or relax silver supply to influence inflation, production costs, and trade balances in rival economies. Technology power plus Robotics– From AI data centers and 5G infrastructure to EVs and next‑gen batteries, silver is baked into the hardware of the digital and green revolutions. Military power – Guidance systems, radar, secure communications, drones, missiles, torpedoes, and space assets all depend on silver‑rich electronics and specialized components. Silver is no longer just “poor man’s gold.” It is an arms‑race metal, and China’s decision to hoard, premium‑price, and restrict exports into 2026 is a declaration that the race is officially on. It is predicted that USA will not just roll over but try and win this war.
As BRICS vs NATO intensify the winner will be SILVER.
Silver just went over $77 per oz.
This is amazing to watch!
> Suppose the banking system were to crash and we need to exchange out silver for something spendable. <
A related question would be: How would you sell your silver in such a situation?
If the banks were down, could you trust the Post Office or UPS to get your silver to a buyer? And would local coin shops even be open, and safe?
I guess you could go to your local grocer, and bargain with him. An ounce of silver for 20 cans of soup. But how safe would shopping be?
Don’t get me wrong. I’m not anti-silver or anti-gold. It’s good to diversify. But I do wonder about their value in a societal breakdown. As the old saying goes, perhaps beans and bullets would be more useful.
I am glad I stacked.
If anyone thinks electrons on a screen, paper instruments denominated in paper “ promises to pay” is money, well, carry on.
As for stacking, we haven’t seen anything yet.
When does it crash?
tech steps up.
.............
The little known fact, Tech needs Silver and Gold, AI centers, I phones, batteries, all computers, etc.....go to the source, without PM’s Tech dies....as we are starting to witness.
So, we can conclude that you own no silver
Silver Trading volume is exploding.
Dec 24, 2024 Comex futures contracts traded = 18,146
Dec 24, 2025 Comex futures contracts traded = 103,975
Silver always inflates.
The differential rate of inflation between silver and gold has been the subject of monetary problems for eons
Oh, and you are saying those contracts would not have been honored with physical gold back then?
Negative. The only difference China has going for it now is a military to protect company storage.
Samsung’s new batteries need a lot of silver. And the company will pay whatever is needed to get that silver. They just entered an agreement to buy two years’ worth of silver and zinc concentrates from Canadian miner Silver Storm Mining.
I’ll sit tight and wait for the $250 I guess.
Tangible is the only option, Land, house,rental, a low mileage vehicle to last into the years, .....holding dollars is not what it used to be. Most don’t realize inflation is accumulative, 3 percent, next year 4 percent, next year 5 percent....we will NEVER see a reduction in Inflation ( - negative numbers) like we did at times when we were on a Gold standard. There were years we had minus 3, 4 even 6 percent inflation.....think about that.
Samsung’s new silver-based solid-state battery technology could require roughly 1 kilogram (1,000 grams) of silver per car, with estimates of about 5 grams of silver per battery cell in a typical 100 kWh pack, a massive jump from the grams used in today’s traditional EVs. This substantial silver content, used in the anode for enhanced performance, means widespread adoption would significantly increase global silver demand.
I am a mining engineer. Increasing silver production is not like a factory increasing production of a manufactured product to meet demand. Most silver (about 75% to 80%) is produced as a by-product of copper, zinc and lead mining. Processing capacity to vastly increase capacity to produce silver is likely not on stand-by awaiting a surge in demand. Environmental regulations make any changes to operations a slow process. Many mines are in Mexico or other countries beyond USA control. Government instability and labor demands (strikes) can cripple a mine and wreak havoc on production goals.
Do we wait for the U.S. currency to kick in
Some, not much, but I bought at $13/oz.
I remember the crash in the 70s, however, when silver got to $50 and crashed. Are the Chicoms any different than the Hunts?
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There are hundreds of Hunt brothers out there now, and not just in this country.
Comex silver trading volume March 2026 contract. As of 10 minutes ago, more than 155,000 Mar 26 contracts were traded.
Today will be an all-time record for Comex trading volume and price increase.
There are some big players pushing the button to go long or short silver futures.
Also the SLV ETF is setting a record trading volume with 117 million shares being bought and sold.
In any other year SLV trading volume on Dec 26th would be around 5 million.
as those in the silver market ponder what to do over the weekend Monday, Dec 29, 2026 will be exciting.
>> What China appears to be trying to do recalls the Hunt Brothers back in the 1970s.
But this time is different! Frankly, I can’t foresee silver EVER dropping again. There will be essentially eternal two to three percent gains approximately every news cycle. Buy silver, as much as you can, whenever you can, at whatever price the seller asks. Then simply hang on and enjoy the breathtaking ride!
Thanks, a very good explanation of the current Silver crisis.
In your opinion and years of familiarity with the less than honest western PM markets, are we reasonable to think the western Comex and LBMA can at some time default? In other words, fail to deliver on physical Gold and Silver contracts?
I am of the opinion not if, but when? President Trump’s refusal to fully audit our Gold reserves is getting stinkier with every day.
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