Could the Silver Price Really Hit $130 per Ounce?

- July 25th, 2018

What’s in store for silver in the future? Keith Neumeyer of First Majestic Silver has said he sees the white metal reaching $130 per ounce.

Silver has made significant gains in the past, but has not risen past $20 per ounce since 2016

Nonetheless, well-known figure Keith Neumeyer, CEO of First Majestic Silver (TSX:FR,NYSE:AG), believes the white metal could reach the $130 level.

Neumeyer has voiced this opinion many times, recently giving the $130 number in a November 2017 interview with Palisade Research, and again in March 2018 with Kitco. In the past he’s been even more bold, suggesting the white metal could reach $1,000.

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In Neumeyer’s opinion, the precious metal is being bolstered by technology, along with other factors. He believes the market needs to return to some “sane-ness,” and that institutions need to “start to recognize the valuations of some of the mining companies and stocks.”

Here’s why he thinks that needs to happen and what he thinks it will take to bring silver up to $130.

Silver in the future: $130 per ounce?

There’s a significant distance for the silver price to go before it reaches the success Neumeyer has boldly predicted. In fact, in order for the precious metal to jump to $130, its value would have to increase by over eight times its current value.

Neumeyer sees $130 silver in the cards in part because he believes the current market compares to the year 2000, when investors were sailing high on the dot-com bubble and the mining sector was down. The First Majestic Silver CEO thinks it’s only a matter of time before the market corrects, like it did in 2001 and 2002, and mining sees a big rebound in pricing. It was during this time that Neumeyer himself invested heavily in mining and came out on top.

He has pointed to repeated gains in the NASDAQ Composite (INDEXNASDAQ:.IXIC) and S&P 500 (INDEXSP:.INX), noting, “billions and billions of dollars are being thrown into these markets, and if the mining sector even got a small percentage of that money it would light up quite dramatically … I think that’s exactly what’s going to happen.”

The First Majestic Silver CEO has also stated that while times have been tough in the mining sector since 2012, many companies have since recovered. He believes investors will see increasing production as cashflow increases and technology infuses the mining sector. Neumeyer also anticipates a steady increase in mining efficiency over the next 10 years, which will be reflected in the value of silver.

Speaking about the current price of silver, Neumyer said it is “a bit of a joke.” He mentioned various other metals that have doubled in price, such as lead, while silver has seen little movement.

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Neumeyer believes the white metal should be uncoupled from gold, and should be seen as a strategic metal due to its necessity in many everyday appliances, from computers to electronics to solar panels. He has also stated that silver production has gone down in recent years, meaning that contrary to popular belief the metal is actually a rare commodity.

According to Neumeyer, “we’re consuming, as a human race, over 1 billion ounces of silver annually, and miners are only producing about 800 million ounces a year, and that’s been dropping for three consecutive years.” He has also pointed to declining grades, making the case for a deficit.

Silver in the future: What others say

While the CEO of First Majestic Silver is one of just a few saying silver is poised to reach a triple-digit price, there is support for Neumeyer’s belief that the metal is undervalued and that “ideal conditions are present for silver prices to rise.” These conditions include low interest rates, overvalued markets and a monetary system overcome with indebtedness. And many are on board with Neumeyer in the idea that mining has entered a bull market.

So, if the silver price does rise, how high will it go? Let’s look at silver’s recent history. The highest price for silver was just under $50 in the 1970s; it came close to that level again in 2011, but has been much lower lately. In 2018, the highest silver has gone is just under $17.60.

In a recent FocusEconomics report, analysts surveyed said they see the white metal averaging $17.80 in 2018, and by Q3 2019, the last quarter for which statistics are given, they believe the average silver price could be as high as $19.20. Overall, it appears as though the general consensus is that silver will increase, but will do so much more marginally than Neumeyer believes unless there is a major catalyst.

Will the price of silver really reach $130? What do you think? Tell us your predictions in the comments.

Don’t forget to follow us @INN_Resource for real-time news updates!

This is an updated version of an article originally published by the Investing News Network in 2016.

Securities Disclosure: I, Amanda Kay, hold no direct investment interest in any company mentioned in this article.

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78 responses to “Could the Silver Price Really Hit $130 per Ounce?

  1. Whether silver goes up or not think about this. A sack full of silver is worth at least about $ 15.00/ oz. A sack full of our paper money is worth about 30 seconds of warmth on a cold day. it has no real value at all. your still better off with cheap silver…Dave

  2. After 2020, when the Democrats are back in power again and put there Green Deal in full force, by the next election come’s in 2024, the country will be in such financial condition all the precious metals will be extremely high in price as it will be the only investment in town to place your money that will be worth anything. Stocks will have collapse by than and won’t be worth more than the paper they are printed on. By than even the Farmers won’t take paper currency in trade for food, but will take tangible goods in trade they can use to buy what they need to stay alive and in business. The young who are now voting are looking for something in return that cost them nothing except their vote at the ballet box. Free education, Health Care and anything else they are promised by the liberals. So stock and be ready for the future to come. It just in the starting phase in 2019, it will grow over time until they get enough votes to make it all happen.

  3. I invest in silver one ounce coins each payday and have been doing this for the past 20 years or so….just wish I had bought more straight out of college when they were literally “giving silver and gold away”….back in 1988 silver was $3.50 per ounce I recall and you could buy a one ounce gold piece for $250 St. Gaudens style all day long…..hindsight as they say is 20/20 and my father was a coin dealer but I did not really get into coins in a big day until my mid-thirties….about 10-15 years later when I wised up and saw the light….even then, wish I had bought MORE. Silver was $4.25 per ounce and gold was then $300 per ounce and barely went up since 1988. So I got started and then took the plunge. I will keep buying silver at $16 – $18 per ounce will all AVAILABLE MONIES GOING FORWARD THANK YOU – minus cost of living and I keep very little cash in the back…….I just “convert my cash” into silver coins mainly and gold coins too though that is too high a price to pay when you work in corporate amerika….silver is often
    called “the poor man’s gold” because it is so cheap. I figure it this way…..”if it never goes up I am OK with
    that…….at least I can cash out in my old age and use it for my retirement…….I won’t LOSE ANYTHING and most likely will make a few dollars……” That is my investment philosophy….”preservation of principal” is the key to wealth accumulation. Right now……it is truly “stealth silver accumulation”….while everyone else is too busy watching sitcom TV and going to “sports games” and eating wings, I am buying the silver and gold that they do not want……..which will only enrich me later……or at least it is something to sell in the hard times coming up which I predict for “Amerika”.

  4. Just a thought,
    Sterling Silver has been in demand by many jewelry artist. It is affordable, a soft metal so pliable and able to be made into intricate pieces of art/jewelry. Examples of this are pieces made and coveted in Taxco Mexico, the silver Capital of the world and
    pieces made in Sheffield UK. If you buy Sterling Silver Jewelry, enjoy it every day and wear it with pride that the artisans had intended, you are already winning in the investment side of “Silver Investing”… Your investment in the future pays you immediately. If by chance, and I whom has very minimal economic knowledge thinks it will, the price of silver does increase dramatically, you have a very positive strategic gain. Though 92.5% value of the Troy market, how can one lose? I have been doing this for several years and even if the market tanks, have enjoyed and gifted a possible monetary jackpot. Just a thought from a commoner. Thanks to all for the great read.

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