Though we are soon leaving the 2023 winter holiday season behind, silver bells keep ringing, signaling likely increases in the metal's price in the new year.
"Silver prices could experience an 'explosive' rise in 2024," said John Newell, president, chief executive officer and director of Golden Sky Minerals Corp., a Canadian minerals explorer. "The fundamentals for the silver market are extremely bullish."
Rick Mills, also optimistic, wrote in his Dec. 24 newsletter, "At Ahead of the Herd, we see strong upside for silver, as we head into 2024."
The Catalysts
Experts said these 5 trends and events, which they anticipate happening in 2024, should boost the silver price:
- Gold continues to rally. Historically, silver has done well during the end of a gold rally, wrote financial expert, Chen Lin, in the December article, "2023: The Dawn of the Silver Boom." Earlier this month, gold and silver hit their year-to-date price highs of US$2,115.10 and US$25.91 per ounce, respectively. Since both subsequently retracted, gold has been rallying but silver has remained stagnant, in the US$24/oz range.
"That means," Lin added, referring to its historical performance pattern, "silver will likely test the US$50 mark and is likely to exceed it."
- Silver demand increases. Silver demand is projected to continue growing, driven by several sectors, including solar energy, industrials (vehicles and consumer electronics) and 5G technology, Newell pointed out. The greater the demand, the higher the silver price.
According to The Silver Institute's World Silver Survey 2023, the next generation of photovoltaic panels is going to need 25−150% more silver for greater efficiency. Silver demand for soldering and brazing in new vehicles is projected to grow 23% by 2030. For 5G technology (semiconductor chips, cabling, microelectromechanical systems and Internet of Things-connected devices), it is forecasted to double by 2025.
All of this need for the metal points to "a structural silver shortage for decades to come," Lin wrote.
- Silver deficit persists. Already silver is in undersupply, for the third year in a row, Lin wrote. Should this trend continue into 2024, as is likely, it would be positive for the silver price.
In 2023, global silver demand was 1.2 billion ounces, but only 820 million ounces were produced, according to the Institute. Worldwide mine production of silver was 2% lower in 2022 than in 2023.
"In order for silver production to catch up with demand, many new primary silver mines need to be built, and the silver price needs to be high for an extended period of time," added Lin.
- Interest rates are cut. The U.S. Federal Reserve projected it will reverse course next year and reduce, rather than increase, interest rates, potentially three times.
"Historically, lower interest rates tend to be favorable for precious metals like silver, as they can reduce the opportunity cost of holding noninterest-bearing assets," Newell said.
- Silver sentiment grows. Were investor interest in silver to increase, noted Newell, it could help boost the metal's price.
Long-Term Price Forecast: $300/Oz
Precious metals expert Peter Krauth believes we are in the middle of a silver bull market that began in 2001, he wrote recently in the Silver Stock Investor newsletter.
Looking further ahead, he projected, "I think silver's bull could run for the rest of this decade, leaving us with six to seven years to go. My target price over the next few years is for silver to reach at least US$300," but that will include volatility and corrections.
He continued, "There will be opportunities to lock in profits along the way, especially in silver stocks, but you need to have a core position you're willing to hold through corrections for maximum gains."
Overall, a higher and rising silver price would be excellent news for silver mining companies, from explorers to producers.
Dolly Varden Silver Corp.
Dolly Varden Silver Corp. (DV:TSX.V; DOLLF:OTCQX) is an explorer for silver and gold that could benefit. It is advancing its Kitsault Valley project that unites the Dolly Varden and Homestake Ridge deposits in British Columbia's (B.C.'s) Golden Triangle.
"It's a quality company with a quality project, and it is one of my favorites in the silver space," Ahead of the Herd's Mills told Streetwise Reports.
In 2023 alone, the Vancouver-based company conducted 51,527 meters (51,527m) of exploration drilling at Kitsault Valley. Results of much of this work are expected to be released over the next few months.
Most recently, Dolly Varden Silver acquired from Libero Copper & Gold its seven claims in the southern part of the Big Bulk copper-gold property, also in the Golden Triangle, a news release noted. The 100% earn-in option allows Dolly Varden to consolidate and eventually own the entire property.
According to the B.C.-based company, it has 270 million (270M) shares outstanding.
Strategic investors hold 53%. They include Fury Gold Mines with 22%, Hecla Mining with 15%, Eric Sprott with 9% and high net-worth investors with 7%. Institutional investors own the remaining 49%.
Reuters reports Dolly Varden Silver's market cap is CA$248M and its 52-week trading range is between CA$0.58 and CA$1.24 per share.
MAG Silver Corp.
Along with the now-producing, joint venture Juanicipio project in Mexico of which it owns 44%, MAG Silver Corp. (MAG:TSX; MAG:NYSE American) has two 100%-owned projects: Larder in Ontario, Canada and Deer Trail in Utah. All three offer exploration upside.
"We see potential for MAG shares to rerate as Juanicipio ramps up and delivers cash flows to the joint venture partners," wrote Kevin O'Halloran, BMO Capital Markets analyst, in November 2023. He rated the Canadian silver company Outperform.
According to Yahoo Finance, MAG has 103M outstanding shares. Insiders own 0.8%, institutions own 54.12% and retail investors hold the rest.
The Top 3 insider investors are George Paspalas with 180,000 (180K) shares, Daniel Macinnis with 136K shares and Michael Curlook with 107.1K shares.
Of the 202 institutional holders, the Top 3 are Van Eck Associates Corp. with 106.4M shares, First Eagle Investment Management LLC with 62.7M shares and ETF Managers Group LLC with 59.2M shares.
MAG has a market cap of US$1.1B and a 52-week trading range between US$9.61 and US$17.02 per share.
Norseman Silver Inc.
Norseman Silver Inc. (NOC:TSX.V; NOCSF:OTCQB) is a precious and base metals explorer based in Vancouver, B.C., with a full calendar of catalysts in 2024.
"Norseman is going to see big changes in 2024, and all are for the better," Michael Ballanger of GGM Advisory Inc. wrote in a recent report.
The mining company intends to use the proceeds of a recent $1M private placement on exploration work at two projects.
Slated for its Taquetren gold project in Argentina is trenching, geophysics and regional mapping in H1/24 and mapping and logistics in H2/24. At the Caballos copper project in Chile, on which the company has an earn-in option, mapping and logistics are to be done in H1/24 and 3,000m worth of drilling in H2/24.
According to Norseman, it has 68.1M issued and outstanding shares.
Yahoo Finance reports insiders/strategic investors own 15.8% of the shares. They include Cloudbreak Discovery Ltd., co-owned by Norseman Director Campbell Smyth, which holds 7M Norseman shares. Captrust owns 10,000 shares. Retail investors hold the remainder.
Norseman has a US$6.18M market cap and a 52-week trading record between US$0.025 and US$0.13 per share.
Western Exploration Inc.
Western Exploration Inc. (WEX:TSX.V;WEXPF:OTC) is a U.S.-based mining explorer currently advancing its Aura gold-silver project in Northern Nevada toward a prefeasibility study.
"We believe WEX's primary strengths are its high-grade Doby George project with near-term production potential, a strong management/board, and Agnico Eagle's backing," wrote Sid Rajeev, Fundamental Research Corp. analyst.
Western Exploration's 2024 plans for Aura, listed in its November 2023 investor presentation, call for resource updates on the Gravel Creek and Doby George deposits in H1/24, followed by drilling of both in H2/24.
According to the company, it has 34.4M shares outstanding.
Directors and management own 7% of the stock. Strategic investors own 75%. They are Golconda with 58%, Agnico Eagle with 16% and SSR Mining with 1%. Institutions, including U.S. Global Investors, the Euro Pacific Gold Fund, Auramet and Parkwood, own 12%.
Retail investors hold the remaining 11%.
Yahoo Finance reports Western Exploration has a CA$23.43 market cap and traded over the past 52 weeks between CA$0.45 and CA$2.28 per share.
Fabled Silver Gold Corp.
Vancouver, B.C.-based Fabled Silver Gold Corp. (FCO:TSX.V; FBSGF:OTCQB; 7NQ:FSE) acquires and explores silver properties in Mexico. It is presently securing funding to close its acquisition of the 2,857-hectare Mecatona property in Chihuahua's Parral silver mining district from Kootenay Silver, the company said.
At Mecatona, according to management, "Other than surface sampling, no modern exploration tools [were] ever used, including drilling."
As such, upcoming catalysts for Fabled and Mecatona, outlined in an investor presentation, include systematic sampling of all old workings, completion of a resource estimate, release of historical exploration results and announcement of an exploration program.
According to Yahoo Finance, Fabled Silver has 43.1M outstanding shares. Management and insiders own 5.4% of them. Specifically, David Smalley holds 5.64M shares. Institutional investors hold 3.5%; Hilton Capital Management LLC owns 10K shares.
Fabled has a market cap of CA$3.02M. Trading of the stock remains on hold until the acquisition closes.
Again, experts predict the silver price will rise significantly in 2024, and this would help support silver companies in their endeavors and their share price. The mining entities mentioned have numerous activities planned for the new year, any of which could catalyze their stock.
