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Silver Has Better Fundamentals Than Gold - Mining CEO

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(Kitco News) - When projecting gold and silver prices, it is important to keep in mind that silver has better fundamentals than gold, according to one mining CEO.

“Silver has always lagged [behind] gold in terms of response. If gold starts moving, silver will move, but it takes a while to get there,” Wheaton Precious Metals CEO Randy Smallwood told Kitco News on the sidelines of the Prospectors & Developers Association of Canada (PDAC) convention. “[But], there are better fundamentals behind silver than gold just because of the increase in the industrial demand, the high-efficiency electronics that we all demand in terms of mobility.”

Silver will continue to see higher demand, which will eventually be reflected in its price, noted Smallwood.

“We’ve hit peak silver a long time ago in terms of production. So, we’ve got declining overall production worldwide combined with increasing industrial demand. It’s a better fundamental argument,” the CEO added.

In terms of future gold prices, Smallwood pointed out that declining exploration budgets over the last decade will to push the yellow metal’s prices higher.

“Lack of product will provide that next phase of gold production, which can only be supportive of prices on the long-term basis,” he said.

Smallwood also admitted to feeling better about the precious metals space.

“There’s definitely a bit of optimism. I don’t see it quite reflected in equity prices just yet. But, there’s definitely a bit more interest, especially in the precious metals space,” he said.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.