For those who are looking for a new area to place their investments, the silver mining industry may be one of the best routes that one can take in the coming years.
According to MarketWatch, HSBC has recently lifted its silver forecasts for 2013 and 2014. The expected price of silver in 2013 has been raised from $32 to $33 per ounce, with 2014 expectations rising even more dramatically from $28 to $31 per ounce.
Investor appetite, strong bar/coin purchases, and a bottoming-out of the jewelry industry are just a few contributing factors. Industrial silver consumption is becoming greater and greater each day, which will no doubt have an effect on overall pricing.
The increase in silver consumption is not in and of itself a reason to look towards investing, however; there is far more at play here than meets the eye.
The silver industry is seeing somewhat of a revitalization as of late. According to The Salt Lake Tribune, gold and silver mines in the U.S., which many people mistakenly believe to be part of the history books at this point, are currently being proposed for Utah’s Tooele County.
Tooele County serves as one of the most historic mining districts in the country, as precious metals have been extracted from the area for well over a century. The reinvigoration of this area is thought to not only have a major impact on the industry, but would bring a great deal of jobs to the area that might not otherwise exist. It would also serve to blaze a trail for other potential gold and silver mines to be opened throughout the country.
Much of the increase in interest that has been surrounding gold and silver mines comes down to the companies which are investing to invigorate the industry. Silver Wheaton Corp (TSX: SLW) may be one of the best examples, as well as perhaps the top stock to watch in the coming months and years. If the company finds the success that they are expecting, it will largely be due to the fact they are the world’s largest “streaming company.”
While likely not a household term at this point, streaming companies are very important to the economy and may mean the difference between an industry that flourishes and one that does not. According to Silver Investing News, streaming companies such as Silver Wheaton Corp. provide upfront capital to miners in order to help fund their projects.
Since having the necessary capital often serves as a major obstacle for those in the mining industry, this platform allows projects that may have never seen the light of day to get off the ground.
Miners have taken exceptionally well to the concept of streaming investments, with many viewing the concept as being a “win-win” scenario for everyone involved.
Shareholders can very easily find themselves fitting into this as well. Because eager miners are often happy to take an offer for upfront capital, the entire industry is expected to see a resurgence, and this means big things for those who decide to invest in silver stocks.
As with any other investment, it’s important to keep a close eye on silver stocks if you plan on taking the plunge. Silvercorp Metals Inc. (TSX: SVM), for example, has suffered a steady negative showing as of late, along with Hecla Mining Company (NYSE: HL), as SBWire pointed out.
Nevertheless, stocks such as Silver Wheaton Corp. and Silver Standard Resources Inc. (NASDAQ: SSRI) are showing quite a bit of promise and are worth looking into.
Determining whether or not the silver mining industry is worth your investment should also be based on whether or not you have a personal interest in silver. There is certainly a lot going on in the industry as of late, and staying on top of a financial investment in this area means keeping current on industry news.
This can be time-consuming and typically requires one to have a strong interest in the industry itself. Those who are intrigued by the notion of a resurgence in silver mining, however, have a lot to love about getting involved as a shareholder in 2013 and 2014.