Silver price predictions for 2017 have the white metal outperforming gold and climbing as high as 33% by year's end.
Nearly all of the 23 precious metals analysts polled in the London Bullion Market Association's annual survey have bullish silver price forecasts.
The LBMA asks each of the nearly two dozen participants for their high and low estimates for each precious metal.
The average high gold price prediction was for a 2017 increase of 11.2%. The average high silver price prediction was for a gain of 14.7%.
The average silver price forecast came in at $17.77, just below the current silver price of about $18 but 7.1% higher than the early January average $16.59 (LBMA measures its precious metals predictions against the early January price average.)
Using that early January benchmark, 20 out of the 23 analysts in the LBMA survey were bullish on the price of silver in 2017.
Here's what these experts think will have the most influence on silver prices in 2017…
Why These 2017 Silver Price Predictions Are Mostly Bullish
While generally positive, the analysts saw some risks to silver this year. Many of these risks it shares with gold – the threat of the U.S. Federal Reserve raising interest rates, a stronger dollar, and rising stock prices pulling money away from precious metals.
Another possible drag on the price of silver, several analysts said, could come from profit-taking by long-term holders of silver exchange-traded funds.
But overall the analysts surveyed by the LBMA see more reasons for silver prices to rise in 2017.
As with gold, widespread global uncertainty – from the Trump presidency to the rise of populism in Europe to the increasing unpredictability of countries like Russia, Iran, and North Korea – could launch a rally at any time.
Unlike gold, half of silver demand comes from industry. So silver prices could get a push from strengthening economies, which also will boost silver demand from the jewelry industry. And if President Trump follows through on his infrastructure spending plans, it will stimulate overall industrial commodity prices, also helping to lift silver prices.
One key to higher silver prices in 2017 could come from demand from the solar industry. Over the past decade, solar demand has soared from 1% of silver industrial use to 14%. Several analysts expect this trend to continue this year as more Chinese solar plants come on line.
Another common theme is that silver is underpriced vis-à-vis gold…
Silver Prices Have No Shortage of Catalysts
"At over 70, the gold/silver ratio is well above the long-term average, making silver relatively
cheap compared with gold," said Carsten Fritsch of Commerzbank AG (OTCMKTS: CRZBY).
Since 1970, the gold/silver ratio has averaged just over 55. If the ratio were to revert to 55, the price of silver would jump to about $22.50 – a 25% gain from today's silver price.
The most bullish silver price prediction came from William Adams of Metal Bulletin, who had an average 2017 silver price forecast of $20.20.
Philip Newman of Metals Focus had the top number of the high-end silver price predictions.
"Silver should record its 2017 high of $24 during Q4, helping to deliver a full-year average of $18.30, some 7% higher compared with 2016," Newman said. His high target of $24 represents a gain of 33% from today's silver prices.
Money Morning Resource Specialist Peter Krauth – who has 20 years of experience in the metals sector – thinks silver has a chance to get to $24 before midyear.
But it depends on whether this happens…