WASHINGTON, November 18. /TASS/. The silver shortage on the global market will reach its highest level in several decades, The Silver Institute said on Friday.

"The global silver market is forecast to record a deficit for a second consecutive year. At 194 Moz [mln ounces - TASS], this will be a multi-decade high and four times the level seen in 2021," the Institute said.

The global demand for silver will gain 16% year-on-year to a new high of 1.21 bln ounces in 2022, experts noted. "Each key segment of demand, except photography, is set to post a new peak," the Institute informed.

Industrial demand and physical investments will continue growing, according to the report.

"In 2022, mined silver production is expected to rise by 1% year-on-year" to 830 mln ounces, experts said. "Output from Mexico will rise most significantly as several major new silver projects that have come online in recent years continue to ramp-up to full production rates," the Institute noted. "By-product silver production from existing mines and new projects in Chile will also be a major contributor to growth. Partially offsetting these rises will be lower output from major silver producers such as Peru, China, and Russia," it added.

Silver prices are expected to drop by 16% annually to $21 per ounce, the Institute said. Experts anticipate "the U.S. Fed to continue lifting interest rates, raising the opportunity cost for precious metals and this, combined with rising yields and ongoing dollar strength, will continue to exert pressure on silver prices."

"Additional stress will also come from silver’s industrial nature, as growing fears over a possible recession will weigh on sentiment, despite its extremely favorable fundamental backdrop," they added.