The world silver industry consists of miners, refiners, traders, and fabricators. Generally speaking, the silver industry overall grew in the decade from 1996 to 2005, with mine supply increasing to meet rising fabrication demand and refiners and traders handling greater volumes to facilitate this growth.
While silver prices were generally flat through most of this decade, prices began rising out of the US$4 to US$5 per ounce range where they had been trapped in 2003. During 2005 and the first half of 2006, silver prices rose sharply, reaching a decade-long high of more than US$9 per ounce in late 2005 and soaring further to nearly US$15 per ounce by April 2006. While low prices hurt the mining sector through much of the 1990s and early 2000s, they had a long-run effect of spurring fabrication demand, particularly nontraditional uses of silver in diverse areas from electronics to medicine.
According to a 2006 report by Peter Klapwijk, world mine production of silver was generally on the increase between 1996 and 2005, during which time production rose from just under 500 million ounces to approximately 642 million ounces. William E. Brooks reported in 2006 that approximately two-thirds of mined silver worldwide is produced as a by-product of copper, lead, zinc, and gold production. As a consequence, silver is mined and enters the market regardless of the price.
Silver resources are spread over all continents (excluding Antarctica and Greenland, where resource estimates are unavailable). The largest producing country in 2005 was Peru, which accounted for slightly more that 15 percent of world output. Peru was followed by Mexico, Australia, China, Chile, Russia, Poland, and the United States. Estimated minable world silver reserves—that is, silver contained in ore that can be mined at a profit—amount to approximately 8.7 billion ounces (Brooks 2006). It is not known, however, how many of these ounces could be recoverable through primary rather than by-product production.
Labor conditions and the degree of unionization in the silver mining industry vary widely around the world. In the United States, for example, every mine worker undergoes safety training before being employed and takes a periodic refresher course. Silver mining, and hard-rock mining in general, however, is significantly safer than coal mining. Coal mining involves digging into a combustible material, which is the cause of many coal mine accidents. This is not the case with hard-rock mining.
Because silver mines tend to be fairly large-scale operations employing several hundred workers at a moderate size mine, the workforce is amenable to unionization. The degree of unionization, however, varies widely depending on national and state or provincial laws. In the western United States, where most of U.S. output comes from, mine workers tend not to be unionized, but many of the specialized tradespeople, such as electrical workers, pipe fitters, and some construction workers, do tend to be unionized. In general, whether union members or not, mine workers are typically among the highest paid industrial workers.
Environmental reclamation laws also vary widely around the world. In the United States environmental laws concerning discharge of pollutants and reclamation are generally administered by state agencies in compliance with U.S. Environmental Protection Agency regulations. In other countries similar regulations may or may not be in force. Nevertheless, international banking concerns typically make compliance with U.S. environmental standards a general condition of financing mine development in other countries. These conditions are generally imposed by lenders to prevent environmental degradation being used as a rationale for nationalization and confiscation of a mining property. Not all mines, however, are financed through international lenders, and in these cases compliance is less certain although there is still an incentive for operators to avoid confiscation and nationalization.
In addition to mining, silver also makes its way into the world supply chain from the reprocessing of scrap metal that comes from various fabrication processes and via sales from government stockpiles. In 2005 mined silver accounted for approximately 70 percent of the total supply, while scrap accounted for 21 percent. Historically, reprocessing photographic wastes has been the major source of scrap, but this is changing because of a variety of factors. Other major sources of scrap include jewelry and silverware manufacturing. In addition to reprocessing scrap, government sales account for 7 percent of the silver supply and producer hedging for 2 percent (Klapwijk 2006). All of these sources combined for a total supply of 911.9 million ounces in 2005 (Klapwijk 2006).
In the case of mined silver, producers ship unrefined product to a refinery for reduction to a commercial grade product. There are many refineries around the world that can process unrefined product, with more than twenty of them located in the United States. These refineries also melt down and refine other types of scrap material to produce a commercial grade product. These commercial grade products can range from products that are alloyed with other metals for special purposes and sold under contract to jewelers and other fabricators to silver bullion that is 99.99 percent pure silver.
Many major commodity exchanges around the world make a market in bullion silver. These include markets in London, New York, and Tokyo, but perhaps the largest is the London Bullion Market Association. Traders in these markets sell silver in “spot” markets, that is, for immediate delivery, and deal in futures and options contracts for delivery in the future.
As noted, fabrication demand has increased since the mid-1990s. The more interesting story behind this increase, however, has been the change in the mix of products fabricated. Historically, the major uses of silver were the minting of coins and the fabrication of jewelry, silverware, and objects of art such as candlesticks and bowls. During the twentieth century photographic processing emerged as a major use of silver, and from the middle of the twentieth century the use of silver for coinage diminished, though substantially only in the United States. Fabrication demand for photography has started to decline as consumers shift from film-based photography to digital cameras. At the same time, however, in spite of the decline in the traditional uses of silver in coinage and photography, demand for silver has been growing as new uses have been found for this metal based on its particular qualities, such as its being an excellent electronic conductor and having high degrees of malleability and reflectivity.
Silver is commonly used in a variety of batteries, from most quartz watch batteries to batteries used in the aerospace industry. Silver batteries are lighter weight and can deliver more power per weight than traditional lead-acid batteries.
Because silver alloys or combines with other metals well, it is commonly used as a coating for bearings in jet engines and for brazing and soldering in electronics and other manufacturing. Perhaps one of the most common uses of silver as a coating is in the manufacture of mirrors. Silver is also used in windows that reflect solar radiation and heat and in eyeglasses. In addition the metal is also an important catalyst used in manufacturing a variety of plastics and chemicals.
The use of silver in the electronics industry is also growing. Because of its conductivity and resiliency, silver contacts are widely used in many industries. High-voltage contacts at power plants and in manufacturing plants frequently are made of silver or are silver coated. Automobiles have silver contacts in ignition systems, other electronic systems, and safety systems, such as air bags. Silver is also widely used for contacts and circuitry in computers, including the contacts under computer keyboard keys.
In medicine silver has long been used as a biocide. Since before 500 BCE it has been known that water, milk, vinegar, and other foods resist spoilage better when stored in silver vessels than in other containers. This characteristic of silver has led to its use in water purification systems, bandages, and other antibacterial, antifungal, and antiviral applications.
Brooks, William E. 2006. Silver. In Mineral Commodity Summaries, January 2006. Washington, DC: U.S. Geological Survey.
Klapwijk, Peter. 2006. World Silver Survey. London: Gold Fields Mineral Services.
John L. Dobra
"Silver Industry." International Encyclopedia of the Social Sciences. . Encyclopedia.com. (November 20, 2017). http://www.encyclopedia.com/social-sciences/applied-and-social-sciences-magazines/silver-industry
"Silver Industry." International Encyclopedia of the Social Sciences. . Retrieved November 20, 2017 from Encyclopedia.com: http://www.encyclopedia.com/social-sciences/applied-and-social-sciences-magazines/silver-industry
Silver Prospecting and Mining
SILVER PROSPECTING AND MINING
SILVER PROSPECTING AND MINING. Silver mining in North America began when the Spanish worked small mines during their occupation of New Mexico, California, and Texas. New Hampshire produced small amounts of silver after 1828, as well as Virginia and Tennessee after 1832. Large-scale silver mining had its beginning in Nevada after 1859, when Peter O'Riley and Patrick McLaughlin prospected the area eastward from the California gold fields and staked what would become known as the Comstock lode. Though looking for gold, their discovery developed into a bonanza mine that yielded ores so rich that within two decades more than $300 million worth of silver and gold had been extracted.
The Comstock pattern, in which prospectors discovered silver while searching for gold, was repeated in various parts of the American West. At Georgetown, Colorado, an original gold placer camp developed as the center of a silver-producing district after the opening of the Belmont lode in 1864. Also in Colorado, the gold camp of Oro City was almost a ghost town when prospectors discovered carbonate of lead ores with rich silver content in 1877, rapidly transforming the town into the greatest of Colorado silver cities, Leadville. Gold prospectors also accidentally discovered the Bunker Hill and Sullivan mines in the Coeur d'Alene district of Idaho.
Silver occurs in lodes or veins that run to great depths underground. Prospectors identify the lode by the outcroppings of such ores. The silver can be recovered by crushing the ore in a stamp mill. This process passes the ore over copper plates coated with mercury and then separates the amalgam by driving off the mercury with heat. Other, more complex, forms of silver are chemically combined with gold, lead, copper, or other metals. The identification of these ores is much more difficult and requires more intricate metallurgical processes for separation. Mills and smelters necessary for treating complex silver ores were not available in the United States until 1866–1868. Thomas H. Selby in San Francisco, W. S. Keyes in Eureka, Nevada, A. W. Nason in Oreana, Nevada, and Nathaniel P. Hill in Blackhawk, Colorado, were all pioneers of the smelting industry in the United States. As a result of their advances in smelting technology, recovered metals such as lead and copper became increasingly significant by-products of the silver smelters.
The prosperity of the silver mining industry in the United States during the nineteenth century was intimately related to the currency policy of the federal government, particularly after the demonetization of silver in 1873. Many of the largest producing silver mines in the country opened after 1873. During the quarter of a century that followed, the nation debated the questions of silver purchases and coinage. The huge quantities of silver produced by these mines depressed the price, and, with the repeal of the Sherman Silver Purchase Act in 1893, the domestic silver market fell to levels so low that many mines suspended operations.
The industry recovered sufficiently to make the years 1911–1918 the peak years in volume of production. An annual average of 69,735,000 fine ounces of silver were produced during those years. After those boom years the continuing low prices for silver and high production costs limited activity in mining. After 1920 the Coeur d'Alene district of Idaho was the leading silver-producing region in the country. In 1970 Idaho produced 42 percent of the 45,006,000 fine ounces of silver mined in the United States, while most of the other silver came from mines in Arizona, Utah, and Montana.
Bakewell, Peter, ed. Mines of Silver and Gold in the Americas. Brookfield, Vt.: Variorum, 1997.
Paul, Rodman W. Mining Frontiers of the Far West, 1848–1880. New York: Holt, Rinehart, and Winston, 1963.
Rickard, T. A. A History of American Mining. New York: McGraw-Hill, 1932.
Smith, Duane A. Mining America: The Industry and the Environment, 1800–1980. Lawrence: University Press of Kansas, 1987.
"Silver Prospecting and Mining." Dictionary of American History. . Encyclopedia.com. (November 20, 2017). http://www.encyclopedia.com/history/dictionaries-thesauruses-pictures-and-press-releases/silver-prospecting-and-mining
"Silver Prospecting and Mining." Dictionary of American History. . Retrieved November 20, 2017 from Encyclopedia.com: http://www.encyclopedia.com/history/dictionaries-thesauruses-pictures-and-press-releases/silver-prospecting-and-mining