Silver Nov '19 (SIX19)
|Tick Size||$0.005 per troy ounce ($25.00 per contract) (Settlement $0.001)|
|Daily Limit||5% above or below previous settlement|
|Contract Size||5,000 troy ounces|
|Trading Months||Mar, May, Jul, Sep, Dec (H, K, N, U, Z)|
|Trading Hours||5:00p.m. - 4:00p.m. (Sun-Fri) (RTH 7:25a.m. - 12:25p.m.) (Settles 12:25p.m.) CST|
|Value of One Futures Unit||$5,000|
|Value of One Options Unit||$5,000|
|Last Trading Day||Third last business day before the maturing delivery month|
Silver is a white, lustrous metallic element that conducts heat and electricity better than any other metal. In ancient times, many silver deposits were on or near the earth's surface. Before 2,500 BC, silver mines were worked in Asia Minor. Around 700 BC, ancient Greeks stamped a turtle on their first silver coins. Silver assumed a key role in the U.S. monetary system in 1792 when Congress based the currency on the silver dollar. However, the U.S. discontinued the use of silver in coinage in 1965. Today Mexico is the only country that uses silver in its circulating coinage.
Silver is the most malleable and ductile of all metals, apart from gold. Silver melts at about 962 degrees Celsius and boils at about 2212 degrees Celsius. Silver is not very chemically active, although tarnishing occurs when sulfur and sulfides attack silver, forming silver sulfide on the surface of the metal. Because silver is too soft in its pure form, a hardening agent, usually copper, is mixed into the silver. Copper is usually used as the hardening agent because it does not discolor the silver. The term "sterling silver" refers to silver that contains at least 925 parts of silver per thousand (92.5%) to 75 parts of copper (7.5%).
Silver is usually found combined with other elements in minerals and ores. In the U.S., silver is mined in conjunction with lead, copper, and zinc. In the U.S., Nevada, Idaho, Alaska, and Arizona are the leading silver-producing states. For industrial purposes, silver is used for photography, electrical appliances, glass, and as an antibacterial agent for the health industry.
Silver futures and options are traded at the CME Group and the London Metal Exchange (LME). Silver futures are traded on the Tokyo Commodity Exchange (TOCOM). The CME silver futures contract calls for the delivery of 5,000 troy ounces of silver (0.999 fineness) and is priced in terms of dollars and cents per troy ounce.
Prices - CME silver futures prices (Barchart.com symbol SI) posted the high for 2018 in January at $17.705 an ounce. Dollar weakness early in 2018 pushed silver prices higher as the dollar index tumbled to a 4-year low in January. Silver prices traded sideways into Q3 and then trended lower into November, posting a 3-year low of $13.86 an ounce. Expectations for tighter Fed policy undercut precious metals prices the second half of 2018 as the Fed continued to raise interest rates. Also, U.S. tariffs on Chinese goods took a negative toll on China's economy as Chinese industrial output trended lower throughout 2018 and slowed to a 2-year low of +6.2% yr/yr pace in December. China's Q4 2018 GDP eased to a 9-year low of 6.4%. Silver prices bounced higher from their worst levels into year-end after a sell-off on global equity markets in December spurred safe-haven buying of precious metals. Silver prices finished 2018 down -9.4% yr/yr at $15.54 an ounce.
Supply - World mine production of silver in 2018 rose 0.7% yr/yr to 27,000 metric tons, to match the record high posted in both 2014 and 2915. The world's largest silver producers in 2018 were Mexico with 22.6% of world production, Peru with 15.9%, China with 13.3%, and both Poland & Chili with 4.8%. U.S. production of refined silver in 2018 (annualized through October) fell by -0.5% yr/yr yr/yr to 4,654 metric tons, down from the 2011 record high of 6,375 metric tons.
Trade - U.S. exports of refined silver in 2015 rose +125.7% yr/yr to 781,000 kilograms. The major destinations for U.S. silver exports are Canada with 55.1% of the total exports and India with 36.4%. U.S. imports of silver mullion in 2015 rose +19.5% yr/yr to 4.660 million kilograms. The bulk of those imports came from Mexico with 42.5% and Canada with 41.2% of the total.
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