Silver Inventory Reaches 16-Year High After Worst Rout Since ’81

January 12, 2014 Leave a comment

Silver Inventory Reaches 16-Year High After Worst Rout Since ’81

Exchange-monitored U.S. inventories of silver jumped to a 16-year high after prices in 2013 tumbled the most in more than three decades. Stockpiles on the Comex in New York touched 176.28 million ounces today, the highest since since July 1997. Inventories have climbed for seven straight sessions, the longest stretch since February. The supplies rose for a third year in 2013, the longest span of annual gains in a decade.“This could well be an indication that demand has slowed down to an extent,” Bart Melek, the head of commodity strategy at TD Securities in Toronto, said in a telephone interview. The drop may also reflect eroding investor interest in silver exchange-traded products, he said.

Prices tumbled 36 percent last year, the most since 1981 and the biggest decline after corn among the 24 commodities tracked by the Standard & Poor’s GSCI Spot Index. Some investors lost faith in precious metals as a store of value amid a rally in equities and muted inflation. Holdings in global ETPs backed by silver dropped in the past four months, the longest slump since at least 2006, when the data compiled by Bloomberg begins.

Silver futures for March delivery fell 1.5 percent to $19.495 an ounce at 1:57 p.m. on the Comex.

To contact the reporter on this story: Debarati Roy in New York at droy5@bloomberg.net

Filed under Macro Trends

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Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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