Soaring silver prices: how PV developers can tackle a new cost challenge

By Carrie Xiao
TSI data shows that in 2022 and 2023, the global silver supply was 31,250 and 31,440 metric tons respectively, up 0.8% and 0.6% on the previous years. Image: TSI

The global price of silver has continued to rise, with the average price increasing from RMB5,330/kilogram (US$23.49/ounce) in mid-May 2023, to the current price on 20 May of RMB8,211/kilogram (US$32.03/ounce). This is a historic high, with prices still on the rise.

The latest report from the Silver Institute (TSI) points out that in recent years, the growth in silver mineral supply has been far behind the growth in demand. With the strong demand growth driven by PV renewables and semiconductor industries, there has been a supply deficit for silver for three consecutive years.

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London Silver Prices (20 May 2024)
NameLatest Price
Spot Silver (US$/ounce)32.03
Silver T+D (RMB/kilogram)8,211
Table showing changes in silver price. Credit:

TSI data shows that in 2022 and 2023, the global silver supply was 31,250 and 31,440 metric tons respectively, up 0.8% and 0.6% on the previous years. Global mineral silver production, however, remained around 25,830 metric tons, with almost no increase.

Against this backdrop, TSI said that the global demand for silver is expected to grow steadily in 2024, making it likely this undersupply trend will continue.

The demand for silver in PV continues to rise

In solar PV, silver is mainly used for silver paste – one of the core auxiliary materials in solar cell processing. Silver paste accounts for the highest proportion of non-silicon costs in cell production; both sides of the cell need silver paste made from high-purity silver powder.

It is evident that the PV sector has been the main source of industrial silver demand growth in recent years. In 2023, industrial uses dominated the global silver demand space, with 654.4 million ounces in 2023, ahead of the next-highest sector, electrical and electronics, which accounted for 445.1 million ounces.

TSI data shows that the demand for silver in PV rose from 3,672 tons in 2022 to 6,017 tons in 2023, with a demand increase of over 60%. Subsequently, the significant growth in the PV sector compensated for less silver usage in other industrial fields.

The TSI predicts that the demand for silver in PV will rise to 7,217 tons in 2024, with an expected year-on-year increase of 20%.

Looking more closely at China in particular, the proportion of silver used in industrial production could reach 80%, with nearly 40% being used for PV, about 40% for electrical components, and the remaining 20% for brazing and electronic components.

Silver in the n-type transition

As p-type begins to replace n-type in modern high-efficiency PV cells,  the demand for silver paste is expected to increase. Specifically, the silver paste consumption per piece for tunnel oxide passivated contact (TOPCon) cells has increased by nearly 80%, and for heterojunction technology (HJT) cells it has almost doubled. TOPCon is becoming the technology of choice for the majority of the largest solar manufacturers.

TSI predicts that in 2024, the global demand on silver paste for p-type cells will decrease from 4,000 tons to 2,600 tons, while the silver paste consumption for TOPCon cells will grow from 1,700 tons to nearly 4,000 tons. Demand for HJT silver paste will increase from 600 tons to 1,000 tons, continuing the trend where p-type and n-type demands rise and fall in opposition.

In 2024, global demand for silver is expected to exceed supply, which will allow for greater resilience in silver price in a demand-driven market. TSI conservatively estimates that the silver price will fluctuate within a range of US$23-30/ounce during the year.

Senior market analyst Alex Kuptsikevich from the FxPro platform said that the near-term target price is US$33/ounce and the long-term trend for silver is bullish, with the potential for silver prices to significantly rise to an all-time high of US$50/ounce.

Minimising silver demand

As silver prices rise, many PV companies are looking to develop products with a lower silver paste requirement to lower costs. Chen Gang, chairman of solar manufacturer Aiko, recently said: “Silver prices will definitely continue to rise. Last year, the average silver price was RMB4,000 kilogram, and now it has risen to more than RMB7,000/kilogram, an increase of 40%. The doubling in price is not surprising at all.”

In order to further reduce silver use and costs, Aiko has developed back contact (BC) modules, focusing on panels without busbars, known as “0BB”. Aiko has also used copper electrodes (silver-free metal coating technologies) with a view to solving the cost issue.

A report released by the International Energy Agency (IEA) earlier this month shows that investment in clean technology worldwide will surge by 70% in 2023. Among this, PV module investment has reached US$80 billion, more than double the investment in 2022, accounting for about 40% of last year’s total sum.

Investment management company Sprott, which specialises in precious metals, notes that the PV industry’s demand for silver will continue to grow. The company estimates that, by 2030 the demand for silver from PV module manufactures will grow by nearly 170% to 273 million ounces, about one-fifth of the total silver volume.

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