Silver inventories on the Shanghai Futures Exchange (SHFE) have plunged to their lowest levels in nearly a decade, underscoring growing tightness in the global physical silver market and raising alarms about global supply chains.
Latest data shows that silver available for delivery on the SHFE has declined to around 350 tonnes, the lowest level since 2015. According to CEIC data, silver inventories stood at 318.546 tonnes as of February 9, 2026, down from 349.900 tonnes reported on February 6, 2026.
This represents a steep decline of more than 88% from the all-time high of 3,091.112 tonnes recorded on January 12, 2021, highlighting the extent of the drawdown in China’s exchange-held silver stocks over the past few years.
Market participants attribute the sharp depletion partly to heavy silver exports from China to London during 2025. These shipments helped ease the global physical squeeze in international markets but significantly reduced local inventories, exacerbating tightness within China’s domestic silver ecosystem.
“China remains one of the world’s largest consumers of silver across manufacturing, renewable energy, and bullion investment,” said Jigar Trivedi, Senior Research Analyst at IndusInd Securities. “China’s silver market has delivered a strong message to global traders and investors this week. The latest inventory decline underscores broader challenges within the physical silver supply chain.”
Trivedi noted that global mine production growth continues to remain modest, while industrial demand — driven by sectors such as electronics, solar energy, and electric vehicles — keeps rising. At the same time, recycling flows have struggled to scale up meaningfully due to price volatility and logistical constraints, limiting the ability of secondary supply to offset the shortfall.
The persistent inventory drawdown has reinforced bullish sentiment around silver prices, particularly in the medium term, as physical availability tightens across key markets.
Ajay Kedia, Director, Kedia Advisory noted that the Shanghai Futures Exchange (SHFE) increased margin requirements on silver contracts in an effort to control high volatility and reduce excessive speculation. This move triggered leverage unwinding in the market; however, silver prices have remained resilient, supported by persistent physical tightness.
SHFE February 2026 silver contracts are up nearly 13% for the month, staging a strong rebound after the recent correction.
“Notably, there has been no fresh influx of metal into exchange warehouses, indicating continued stress on the supply side. At the same time, robust demand from the solar and electric vehicle (EV) sectors continues to underpin silver consumption. Adding to the tightness, the price premium of SHFE silver over COMEX remains unusually elevated, making imports commercially unviable and restricting the smooth flow of supply into China,” said Kedia.
While exchange-level measures may help cool near-term volatility, Kedia cautioned that the underlying supply constraints in the silver market remain very much intact.
Silver price outlook
Comex silver price is trading near the $78–$83 zone after a sharp correction from record highs above $121.
According to Trivedi, the outlook for silver prices remains constructive despite potential near-term resistance. He expects Comex silver prices to encounter resistance around the $90 per ounce level in the short term.
On the domestic front, MCX silver price for March futures contracts is projected to rise to ₹Rs 3,20,000 per kilogram over the next month, supported by strong physical demand and supply-side constraints, Trivedi said.
Ponmudi R, CEO of Enrich Money, believes while the broader bullish structure remains intact on higher timeframes, the steep pullback has pushed prices below key moving averages, indicating short-term bearish pressure and an extended corrective phase.
“Strong buying interest is visible in the $65–$70 support band, aligned with prior swing lows and long-term trend support. A sustained hold above this base, followed by a recovery and close above $85–$92, could revive upside momentum toward $95–$105 and potentially retest previous highs,” said Ponmudi R.
According to him, the medium- to long-term outlook for silver prices remains constructive, supported by steady industrial demand and structural supply constraints, despite elevated volatility.
Market watchers will continue to track inventory movements on major exchanges, as sustained low stock levels could amplify price volatility and strengthen silver’s appeal as both an industrial metal and an investment asset.
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