Scary—-China is using silver as an economic weapon
Mike59
Posts: 424 ✭✭✭✭
I didn’t know how much of the annual refined global supply China really Controlled, did you???
On Jan. 1, China's new export-licensing regime took effect, putting government gatekeepers between 121 million ounces of annual silver exports and the rest of the world. That means 60%-70% of the globally traded refined supply will require Beijing's permission to leave the country. Story below.
MIKE B.
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Comments
AND?
Looks like the USA needs to ramp up refining.
The whole Western world needs to get control back over the commodities they need and use. We need to refine our own Gold, Silver Platinum and Palladium and Not just PM but all Metals including rare earth metals. China refines over 90% of rare earth minerals and we need them for cars, electronics, computers,cell phones and defense. I would Not be surprised if China has 4 times as much Gold as US (hopefully Fort Knox is full). We officially have 261.5 million ounces or 8133 metric tons & I would not be surprised if China has over 30,000 metric tons.
JMHO,
Mike
MIKE B.
Thus the Venezuela move. Next Trump will kick out the Chinese influence from that country.
Loves me some shiny!
“Often wrong, but never in doubt.”
Yeah we don't even go mining for the stuff (just a byproduct of copper mining) and we still got the stuff flowing out of our ears. If it were actually needed it, we would be mining accordingly. RGDS!
The whole worlds off its rocker, buy Gold™.
BOOMIN!™
Wooooha! Did someone just say it's officially "TACO™" Tuesday????
Retiring at 55, what day is today?
I don't know if I would call it weaponization, more like leverage.
Shrewd, considering the US has now backed off solar. I suppose the strategic designation will probably happen.
when used as leverage in geopolitics (and it will become part of future negotiations) it becomes a weapon.
Didn't we start using the dollar as a weapon? LOL
When gold and silver move together, it signals the coming end of fiat money.
We should be careful what we wish for. Mining and PM refinement has a major negative environmental impact, never mine impact on us, which is why a lot of it today is done outside the U.S. Nobody wants it in their backyard with the destruction of the surrounding landscape and release of harmful carcinogens. I'd like to keep Alaska and other natural wonders we have pristine. Also it takes tons of iron ore and other base metal mining to get ounces of silver. Hopefully there are other solutions.
sounds like we need to prep "Operation Silver Resolve"
Loves me some shiny!
“Often wrong, but never in doubt.”
USA should ramp up mining, especially since silver is now "critical."
When gold and silver move together, it signals the coming end of fiat money.
https://www.reuters.com/world/asia-pacific/korea-zinc-board-discuss-plan-build-smelter-under-us-joint-venture-source-says-2025-12-15/
Google Palmerton Zinc Superfund
Knowledge is the enemy of fear
The current Administration doesn't care about the environment.
Research Mining and the environment, it's a lot different than 100 years ago.
Luckily China does - and pollution stops at their borders...
I know they can’t control the counterfeit stuff that shows up by the boatload at our shores.
``https://ebay.us/m/KxolR5
WASHINGTON: Korea Zinc plans a $7.4 billion investment to construct a large-scale non-ferrous metals smelter in Clarksville, Tennessee, a project U.S. officials say will materially expand domestic critical minerals processing capacity and strengthen supply chain security.1
Loves me some shiny!
“Often wrong, but never in doubt.”
About time!
I knew it would happen.
Isn’t safe to assume that New Korean Zinc and copper refinery in TN should also throw off some by-product Silver, and PGM ?
MIKE B.
On a potentially related note...
https://www.mining.com/web/chinese-zinc-smelter-breaks-contract-with-tecks-alaska-mine-amid-tariffs/
12/11/2025 -Zhuzhou Smelter Group, one of China’s largest zinc smelters, broke a supply contract with Teck Resources’ Red Dog mine in Alaska earlier this year due to hefty tariffs fueled by Beijing and Washington’s trade war, two sources familiar with the matter told Reuters.
Vancouver-based Teck supplies zinc concentrate from Red Dog, one of the world’s largest zinc mines, to global clients including in Asia.
@Mike59 commented “Isn’t safe to assume that New Korean Zinc and copper refinery in TN should also throw off some by-product Silver, and PGM ?”
Yes, my good friend Gemini confirmed that silver can be a major byproduct of zinc mining!
Silver was not mentioned in the Reuters article linked by RedneckHB, shown below.
This is about a 2 hour drive from Ford’s recently repurposed Blue Oval facility.
I have a couple thoughts, as follows:
1) @Mike59: the article is intended to be scary. I guess this guy's trying to frighten wealthy people to drum up business for his business/social network → the author's profile on MarketWatch states "Charlie Garcia is the founder of R360, a global community of individuals and families with a net worth of $100 million or more"
2) He makes it sound near-impossible to increase silver production. But as the price of silver increases, it becomes more economically efficient to restart production at old mines too. Not saying it'll be easy or quick to source more silver [it won't], but it's not impossible.
3) @derryb "Didn't we start using the dollar as a weapon?" → Start? Yeah, probably in 1950.
4) Looks to me like silver will continue to be volatile for a while. Will the price drop below $70 ever again? Who knows? I suspect it will at some point, but then I've been wrong before. At any rate, I expect the price chart to continue looking like a roller coaster for quite a while (at least the next 3 months and probably longer).
5) Will China squeeze silver supply? Maybe, maybe not. Maybe they're just keeping that as a possible weapon in the on-off trade war with the US.
6) If China does decide to manipulate the price of silver, you and I can't really do much about it. Maybe buy now and wait for the price to go even higher. But 'if' is the operative word, and I will not be frightened into buying a commodity whose price has doubled in the last 6 months alone.
7) While I like the metal, I am extremely cautious about any asset whose price I believe to be manipulated.
Serving the greater Mechanicsburg and Camp Hill, PA area
https://zenithbullionconsulting.wordpress.com/
Some would say silver is still at the bottom.
"“Those who sacrifice liberty for security/safety deserve neither.“(Benjamin Franklin)
"I only golf on days that end in 'Y'" (DE59)
And they would have reason.
The gold/silver price ratio (compared to the gold/silver crustal ratio) tells me that at least one of three things must be true: gold is way overpriced, or silver is way underpriced, or the demand for gold is much greater than the demand for silver.
Which is the case? Or are they all true? Each person will have to decide for him/herself.
Serving the greater Mechanicsburg and Camp Hill, PA area
https://zenithbullionconsulting.wordpress.com/
>
With everything going on the last couple of years I would think that gold's reputation of being a safe haven is driving the demand for gold more than the demand for silver. Of course, with the recent silver prices that "demand gap" will likely continue to close. People who can't afford gold are looking at silver....
more and more people are realizing they need "dollar insurance."
When gold and silver move together, it signals the coming end of fiat money.
@ZenithBullionPA said:
1) @Mike59: the article is intended to be scary. I guess this guy's trying to frighten wealthy people to drum up business for his business/social network → the author's profile on MarketWatch states "Charlie Garcia is the founder of R360, a global community of individuals and families with a net worth of $100 million or more"
It’s Morningstar and It’s a pretty respected name in the investment community. Aside from that I think most of the information is true. Hence my statement that it’s “pretty scary” that the US has had their head in the sand and allowed 1 country to have so much power In respect to Precious Metals and Rare Earth Minerals and Metals.
JMHO,
Mike
MIKE B.
I'd note that's the online version of a re-print. The linked article was originally published on MarketWatch - Mr. Garcia maintains a weekly (?) column there.
Not saying Charlie Garcia is making things up; he isn't. However, given enough information, it is possible to spin up a scary story or a copacetic story about pretty much anything.
For instance, consider: most of the world's silver is mined in the Americas. Mexico, in fact, is the world's number one silver miner, mining almost twice as much silver as China in the #2 spot. Peru is right on their heels at #3, and then it's a considerable gap to #4 - Bolivia. Chile, the United States, and Australia are also in the top ten silver miners worldwide. Add up the silver mined by Mexico and Peru, and then throw in the United States - those 3 countries alone mine more than 3X the silver mined in China!
China has done the majority of the refining for maybe 30 years, but geopolitics will ensure that practice is coming to an end. Refining capacity in the West has mostly atrophied, true, but I suspect that other countries, especially Mexico or Peru, could and will expand their refining capabilities.
The Americas have most of the actual silver. Many Chinese refineries will be sitting idle if everyone sends their supply elsewhere! → That's what I mean about how easy it is to spin a story. The one you've linked above is pessimistic, mine is optimistic. Both are true.
What does this mean for silver? I suspect the price will stay high for a little while, and maybe even go higher. China's position is sufficiently strong to inflict some damage on Western countries and businesses in the short term, if they wish. But as silver goes higher, it will become more profitable to mine and refine. As more silver gets pulled from the ground and more refineries in friendly areas go online (or expand their current operations), the price of silver will either stabilize or drop.
As for the refining being concentrated in China's hands, that's a direct result of longstanding Western policy. "Let a low-wage country do our metal refining [manufacturing, etc.]. More profit for us!" Well, until that only works until that country decides to shut off the tap. And if it's too militarily strong to implement regime change...well, we see the results.
I'd agree with you that a single country (China) has too much power over precious/rare earth minerals. However, I'm sure there are a lot of people in the world who believe the United States has way too much power over...everything. New York and London pretty much control world banking, with Hong Kong as sort of an Eastern branch of Anglo-American policy. And then the USA has engaged in overt military-backed regime change...what? 5 times in the past 20 years? If I lived in a non-allied country, I'd be scared stiff that the United States would invade!
What we're seeing is just another instance of the fragmentation of the existing order. Globalization works fine as long as everybody goes along with the program. But other nations are starting to flex. They're not strong enough to go toe-to-toe with the US yet, but a few countries have become strong enough to tell us off without getting instantly pounded into submission.
China actually played it very smart - they went along with the program until they built up not only their military, but their industrial base, their banking and international payments sector, their consumer economy, their influence over non-aligned countries via the Belt-and-Road Initiative...anything we could possibly do to punish China, they've reinforced their own capabilities there. Now they can tell us to go pound sand and there isn't a whole lot we can do about it.
We've all become accustomed to the near-total dominance of the United States. But that ascendance, like the power of any empire in history, has an expiration date. With that in mind, diversification is wise.
Serving the greater Mechanicsburg and Camp Hill, PA area
https://zenithbullionconsulting.wordpress.com/
In recent years both LBMA and COMEX, in need of more sources for bullion to go in their vaults, they increased their approved refiner list to include refiners in China. Just last year LBMA was experiencing a metal shortage and resolved it with massive imports from China. Now that China has put a lid on their silver exports (they are a very large source of in ground metal) western vaults will not be receiving China metal in their times of need. This in itselft is a major even in western supply of silver and will help keep spot prices high.
When gold and silver move together, it signals the coming end of fiat money.
@derryb
Not sure if China has decided to actually slow down deliveries of silver to Western sources. Their new policy will enable them to do so. Doesn't necessarily mean they will.
Feel free to share links to help educate me. It's possible...okay, probable!...that you know more than me.
Serving the greater Mechanicsburg and Camp Hill, PA area
https://zenithbullionconsulting.wordpress.com/
Here's one of many reports on China's silver export restrictions.
The announcement of Chinese export restrictions set to go into effect in 2026 added fuel to the silver fire.
Under the policy, only large, licensed, state-approved companies with an annual silver production capacity of 80 tonnes and a credit line exceeding $30 million will be able to export silver. According to analysts, the rules will lock hundreds of small and mid-sized exporters out of the system. These smaller firms are key suppliers to industrial users and silver refiners around the world.
China controls around 60 to 70 percent of the world’s refined silver supply.
When gold and silver move together, it signals the coming end of fiat money.
Okay, thanks, that's a good overview of the overall situation over the past few weeks. It summarized several of the things I've been reading from different sources.
I think the key part for our discussion here is "the rules will lock hundreds of small and mid-sized exporters out of the system."
So that will, at least temporarily, keep the price of silver up.
Serving the greater Mechanicsburg and Camp Hill, PA area
https://zenithbullionconsulting.wordpress.com/
Shoot, All you need is a license.
Knowledge is the enemy of fear
LOL, CCP will only approve licenses of state owned enterprises and I’d bet no lower than $100.00 an ounce or more, I guess we’ll see where the market opens at in 40 minutes.
JMHO
Mike
MIKE B.