Following a massive year of physical silver purchases in both the United States and Europe in 2022, the two regions have gone in very different directions this year, according to analysts at Metals Focus. “During 2020-22, exceptionally strong demand for silver coins and bars by western retail investors was an important feature of the global silver market; this in turn contributed to a widening physical deficit,” the analysts wrote in the latest Precious Metals Weekly report. By Ernest Hoffman for Kitco News

Gold investing in the massive Indian gold market looks to be returning to normal levels, according to data released by Metals Focus in its latest Indian gold report for 2023. Metals Focus said that demand for gold bars and coins in India fell by 7% in 2022 but remained above pre-pandemic levels. In its report, Metals Focus said “we expect the economic environment to remain broadly supportive of gold demand in 2023. However, the interplay of inflation, local gold prices and how the monsoon plays out, will understandably shape demand this year.” By Stuart Fieldhouse for The Armchair Trader

The resiliency in the U.S. economy is forcing markets to re-price the monetary policy outlook for the rest of the year. And as gold looks to end the month down $65, Metals Focus analyzed how much lower gold can fall in light of stronger-than-expected economic indicators. Gold is seeing its worst month since February as markets shift expectations, pricing in a nearly 100% chance of a rate hike in July. After kicking off the month above $1,980 an ounce, August Comex gold futures last traded near 3.5-month lows at $1,916. By Anna Golubova for Kitco News

The palladium market is still expected to be in undersupply this year, with consultants Metals Focus seeing a deficit of 707,000 ounces and specialist materials maker Johnson Matthey a shortfall of 43,000 ounces in the roughly 10 million ounce a year market. But in spite of that, “investors and market participants are acutely aware of the longer-term headwinds that automotive offtake is bound to face as a result of electrification, especially for palladium and rhodium”, Wilma Swarts, Metals Focus’ director of PGMs, said when the forecast was published. By Ashitha Shivaprasad Reuters

The significant lag in the detailed data is due to the length of time it takes for various large-scale mining (LSM) data points to be published and collated. Our figures – supplied by Metals Focus – also include estimates for artisanal and small-scale mining (AGSM). Challenges in compiling accurate estimates for this portion of global gold production also contribute to the delay. By Krishan Gopaul for Gold Hub

2022’s new record high gold prices saw global mining output rise by 1% to the 2nd highest total on record behind 2018, according to precious-metals supply and demand specialists Metals Focus. Now the consultancy’s new Gold Focus 2023 report forecasts that will grow by 2% this year to a fresh high above 3,650 tonnes, with expanded output from all regions except Asia. By Bullion Vault

Demand for gold will drop 9% to 4,375 metric tons this year with central banks’ appetite falling from last year’s all-time high, consultancy Metals Focus said, adding that gold prices would be under pressure in the second half of 2023. The net official sector purchases jumped 141% to a record high of 1,083 metric tons in 2022 amid de-dollarization activity, inflated by Western sanctions on Russia after its invasion of Ukraine. By Polina Devitt for Reuters

Gold demand is expected to drop by 9% in 2023 as central banks slow their official purchases of the precious metal after a record year, with prices also facing downward pressure in the second half of 2023, according to Metals Focus “The projected 9% drop in demand is almost entirely down to a fall in net official sector purchases from last year’s all-time high; most other demand sectors will see modest growth,” Metals Focus said in its Gold Focus 2023 report published Wednesday. By Anna Golubova for Kitco News

Electric vehicles don’t need catalytic convertors, and therein lies the conundrum for PGM producers, which are relying on an emergent hydrogen economy to take up the slack in demand. (PGMs are used as catalysts in electrolysers and fuel cells). “There are differing views on the pace of vehicle electrification by various stakeholders,” Metals Focus writes. “Furthermore, the uncertain growth trajectory of the hydrogen economy is also contributing to disparate opinions.” By Reuben Adams for Stockhead

Consultants Metals Focus forecast a 953,000-ounce platinum undersupply, up from just 53,000 ounces in 2022. The forecasts use slightly different methodology, with Metals Focus excluding platinum bought or sold by exchange-traded funds. By Reuters

Platinum, palladium and rhodium markets will see their biggest deficits in years in 2023 but undersupply is unlikely to lift prices much, consultants Metals Focus said on Monday. All three metals have similar physical and chemical properties, and are chiefly used in vehicle exhausts to neutralise harmful engine emissions. By Reuters

“Imports went up in 2022 as demand rose after two years of Covid-19. But now the situation has normalised and imports will come down. But the high prices will dent the demand by 15 -20 per cent,” said Chirag Sheth, principal consultant of Metals Focus, an independent precious metals research consultancy. By Sutanuka Ghosal for The Economic Times

“We are moving into a different paradigm for the market, one of ongoing deficits,” said Philip Newman at Metals Focus, the research firm that prepared the Silver Institute’s data. “Silver demand was unprecedented in 2022, and we don’t say that to try and be sensational, that is the only way to describe the market,” Newman stated in an interview with Kitco News this week. By Rick Mills for Mining.com

That being said, Metals Focus gave a very succinct presentation of the silver market and their very forward-looking view of the price for the white metal for the coming year. There will be silver supply deficit for the next few years. Additionally, in their note they mentioned that “the combined shortfalls of the previous two years comfortably offset the cumulative surpluses of the last 11 years”. By
G. Miguel Perez-Santalla for Kitco News

“Silver demand was unprecedented in 2022, and we don’t say that to try and be sensational that is the only way to describe the market,” Neman said. “The silver market has entered a new paradigm of deficits that kicked off in 2021.” Looking ahead, The Silver Institute and Metals Focus expect silver to post another “sizable deficit,” even if it is down from last year’s record highs. Analysts expect solid demand will create a market deficit of 142.1 million ounces in 2023. by Neils Christensen for Kitco News

“We are moving into a different paradigm for the market, one of ongoing deficits,” said Philip Newman at consultants Metals Focus, which prepared the Silver Institute’s data. But he said this wouldn’t necessarily cause prices to shoot higher because while visible silver inventories are falling, huge amounts of metal held by individuals and investors can still fill supply gaps. By Peter Hobson for Reuters