News that HSBC (NYSE ADR: HBC) has concluded a second large purchase of silver bullion from KGHM Polska Miedź S.A. (OTC: KGHPF), the world's largest silver miner, has sparked speculation that there is a physical silver shortage in the markets.
KGHM issued a press release on Wednesday which read in part,"... on 21 January 2013 a contract was entered into between KGHM Polska Miedź S.A. and HSBC Bank USA N.A., London Branch for silver sales in 2013. The estimated value of the contract is PLN 1,672,260,469.66 [$532.6 million]."
The press release continued, "As a result of entering into this contract, the total estimated value of contracts entered into between KGHM Polska Miedź S.A. and HSBC Bank USA N.A., London Branch over the last 12 months exceeded 10% of the equity of the Company and amounts to PLN 3,654,120,061.59 [$1,163.7 million]."
Coming on top of news earlier this week that the U.S. Mint had temporarily run out of Silver Eagle coins and that the iShares Silver Trust (NYSE: SLV) had added 18.4 million ounces of silver to its holdings, nearly as much as the 20.8 million ounces added during all of 2012.
Together, these events have triggered rumors of a looming silver shortage - is it so?