Silver eagle bullion sales in 2011 hit new record

The correction in silver prices has not shaken investor confidence. In fact, bullion investors have stepped up their purchases this year. With just under two months still remaining in 2011, sales of the American Silver Eagle have already surpassed the record level of 2010 with sales of 36,375,500 ounces. If sales of the Silver Eagle for November and December match the levels of 2010, total sales for 2011 should total over 42 million ounces or more than 20% above the record breaking sales level of

Increasing Demand for Silver by the Solar Energy Industry

http://silverprices.com/blog/?p=132

The US debt crisis and European economic woes has sent the silver trading industry into a turmoil as prices kept on declining through much of August. Traders and investors are grappled with fear since the current crisis could cause a decline in demand for industrial silver. Another interesting point that has come forward is the growing inflation rate in China, hindering a country’s growth that along with Brazil and other developing countries has until now ceased further recession dips.
Across global markets, Friday and Monday have shown renewed improvement suggesting investors nature to risk probabilities. Silver as an industrial metal is demonstrating a reestablished interest, helping to stabilize prices.
Silver’s role to buoy prices and act as a safe haven asset depends much on its role as an industrial metal. Silver investors need to look deep into this factor of the need of silver as a commodity in the industrial sector.
Despite anticipation of another recession, optimism still rules in favor of silver that there would be increasing demand from developing countries for silver intended for agricultural, industrial and energy-based goods.
In spite of the fact that investment markets eat a major part of pie share in silver demand, industrial use of silver is still the largest market, advancing from 349.7 million ounces in 2001 to 487.4 million ounces in 2010.
Presently, industrial demand for silver is 50% but is expected to increase to 70% by the next decade.
Silver’s role as an industrial commodity acts as an excellent reflector of light, heat transfer, conductor of electricity and a good lubricant, alloy and catalyst. Therefore, its make a great material in applications from the electrical and electronics industry which occupies the largest share of global silver industrial fabrication. Moreover, progressive techniques in the field of solar photovoltaics and its ability to effectively conduct electrical and thermal energy are making it an important raw material in solar power industry.
The demand for silver in the solar photovoltaics in both US and Asian markets will continue to grow in the coming decade with an increase of 12% in US and 11% in Asian markets by 2015.
The increasing use of solar power as an alternative energy has augmented demand for silver which could double from 50 million ounces consumed in 2010 to over 100 million ounces by 2015. In 2011, the demand is expected to grow to 70 million ounces, an increase of 40% from last year.
The increasing demand for traditional as well industrial silver will have positive medium to short term impact where it is expected that silver will break the $100 an ounce barrier by the year end.

COMEX Options Expiration Operational Procedures for the Trading Floor and Clearing Members Effective Thursday, August 25, 2011

TO: Clearing Member Firms Floor Brokers/Floor Clerks
FROM: CME Clearing
DATE: August 24, 2011
RE: COMEX Options Expiration Operational Procedures for the Trading Floor and Clearing Members Effective Thursday, August 25, 2011
The expiration date for the September 2011 options contract for Copper Option (HX), Gold Option (OG), and Silver Option (SO) is Thursday, August 25, 2011.

GENERAL OPERATIONAL PROCEDURES
All Clearing Members and Qualified Floor Traders that carried an options position as of the close of business day prior to the expiration day, or engaged in trading activity on Expiration Day in the expiring options contract will be required to have a knowledgeable, duly authorized representative present at the their normal work station promptly at 2:15 PM EST until released by the Exchange staff as specified below. All adjustments and/or corrections, must be accompanied by relevant supporting documentation prior to being incorporated into expiration processing, in essence making the expiration processing an extension of the afternoon trade resolution procedures.

CME Group NY Division Clearing (212-299-2120), COMEX Floor Trade Processing (212-299-2465 and 212-299-2044) personnel, as well as a representative of the Floor Committee will be available to assist with the processing of notices of Exercise and Abandonment, position transfers, trade corrections and other questions or problems you may have.


CLEARING DEPARTMENT OPERATIONAL PROCEDURES
The Option Expiration process is a screen based process for which all information is provided in FEC (Front End Clearing) and the CME Position System. No Option Expiration Reports will be provided. The following screens will assist you through the Option Expiration process:

ALLOCATIONS AND CLAIMS DEADLINES Give-up orders entered by the executing Party must be allocated within 30 minutes from the time the trade was entered into FEC. The carrying Clearing Member must accept or reject trades within 60 minutes of allocation. Allocations may not be transferred following the last day of trading for the expiring option contracts.

MEMBER TRADE INQUIRY (FEC)
Contains real-time top day trade information, trade information for the previous 4 business days and trades adjusted for the previous 4 business days by adjustment date.

POSITION LIST (CME Positions)
Contains a real-time snapshot for each option series from the start of day position to the projected end of day position.

REVIEW TRANSFERS (FEC)
Contains all trade transfers “TO” and “FROM” your firm and the status of each transfer. Search Type: Transfer Sub Type: Normal

OPTION EXERCISE NOTICE SUBMISSION (CME Positions) (Option Instruction Entry)
Contains your available long position and an input field to enter the number of long positions you wish to exercise.

OPTION ABANDON SUBMISSION (CME Positions) (Option Instruction Entry)
Contains your available long position and an input field to enter the number of long positions you wish to abandon.

CONTRARY OPTION EXERCISE/ABANDON INSTRUCTIONS
These will disseminated via e-mail. They will also be available on the CME Group NY Division 24 Hour Information Service and on the web at http://www.cmegroup....ption-exercise- instructions.html .

POSITION CHANGE SUBMISSION (CME Positions) (PCS List)
PCS may be submitted either by manual input or by electronic transmission. To enter your firm’s final PCS manually, enter the Long PCS and check the lock button adjacent to the Long PCS. Checking the lock box will make the system ignore any further transmissions or edits from the firm for the day unless the lock checkbox is removed. This input may be made at any time prior to 6:45 PM EST.

ALL POSITIONS ARE DEEMED FINAL (CME Positions)
Upon completion of all PCS input, all positions will be deemed final.

EXERCISE/ASSIGNMENT INFORMATION (CME Positions) (Option Instruction Summary)
This will be available to you by contract series which contains all your Assignments on one window. You will be notified of its availability by E-Mail and by the CME Group NY Division Clearing 24 Hour Information Service. Exercise/Assignment information is also available in the POS650 report.
All Clearing Members are required to have an authorized representative(s) available for any communication during the expiration process.

CLEARING DEPARTMENT 24 HOUR INFORMATION SERVICE
Clearing Members should call the CME Group NY Division Clearing 24 Hour Information Service at (212) 299-2309, Option 1 (Clearing Report Status), Option 2 (Option Expiration Status) for messages advising Members of the event status.
E-MAIL
Clearing Member Representative should read their E-Mail messages immediately to be aware of each event status.
The standard event CME Group NY Division Clearing 24 Hour Information Service and/or E-Mail messages and the sequence in which they will be announced are:

CLEARING STANDARD EVENT MESSAGES
Option Exercise/Abandon Notice Submission Deadline
Announce Out-of-the Money Exercise and In-the-Money Abandon Submissions
All positions are deemed final
Announce Exercise/Assignment Information Availability in CME Positions and Expiration Report A vailability

APPROXIMATE TIME OF MESSAGE AVAILABILITY
N/A 4:45 PM EST
7:00 PM EST 8:30 PM EST
USUAL EVENT TIME
4:30 PM EST 4:45 PM EST
7:00 PM EST 8:30 PM EST
24 HOUR INFORMATION SERVICE (F) E-MAIL (E)
BOTH N/A B
F B
The times appearing in the Usual Event Time column are based on normal operational conditions and could vary.
If you have any questions concerning these procedures, please contact Melvin Garcia at (212) 299-2144 or Melvin.Garcia@cmegroup.com, Joe Fata at (212) 299-2165 or Joe.Fata@cmegroup.com, or Anthony Di Benedetto at (212) 299-2152 or Anthony.DiBenedetto@cmegroup.com, prior to the expiration process.

COMEX Registered Silver Bullion Inventories Fall Sharp 38.5% in Two Weeks – Risk of COMEX Silver Default Remains

Spot gold and silver prices rose slightly again this morning after hitting a one-month high yesterday as equity markets internationally came under selling pressure. The Moody's downgrade of Greece and worryingly poor US economic data again pushed investors to seek the safe haven of bullion. Gold reached new record nominal highs in sterling yesterday (£945.62/oz) as the pound fell on concerns about the UK economy.

Silver Prices and Rates
Markets await key U.S. data on nonfarm payrolls Friday, while ongoing concerns over Greek sovereign debt and contagion in the Eurozone also affected market sentiment and supported the precious metals.

COMEX Silver Bullion Registered Inventories – January 1996 to May 31st 2011
Friday's U.S. payrolls is likely to show that the world's largest economy is weakening and may be on the verge of a double dip which will likely lead to further safe haven demand.
Seeing as the extent of the recovery was always exaggerated, this is not a surprise to us.
The supply situation in the silver market gets more interesting by the day.
Registered COMEX silver inventories have fallen to multiyear lows at 29,631,268 ounces. In the last 5 days they fell from 32,132,903 ounces to Tuesday’s holdings of 29,631,268 ounces. As can be seen in the table below registered silver inventories fell every single day last week leading to a sharp fall of 8.4% in 5 days.
Registered metals are those metals which meet the standards for delivery under the silver futures contracts and for which a receipt from an Exchange-approved depository or warehouse has been issued. Eligible metals are those which meet the delivery standards as stated in the rules for which no receipt from an Exchange-approved warehouse has been issued.
This is a long term trend that has been seen since the early 1990’s when total COMEX silver stockpiles were over 101.45 million ounces.

However, the scale of the drop in inventories since early 2008 is significant and the trend has accelerated in recent weeks.

Registered silver inventories are down a sharp 38.5% in just two weeks – from 41,044,280 to 29,631,268

COMEX Silver Bullion Registered Inventories – June 2009 to May 31st 2011
The record nominal highs near $50/oz, seen 31 years ago and again at the end of April, are likely to be seen again sooner rather than later due to the increasingly delicate supply demand balance.
The scale of current investment demand and industrial demand, especially from China and the rest of Asia, is such that it is important to keep monitoring COMEX warehouse stocks.
The Hunt Brothers were one of a few dozen billionaires in the world in the late 1970’s when they attempted to corner the market. Today there are thousands of billionaires in the world, any number of whom could again attempt to corner the silver market.
Also, today unlike in the 1970s, there are sovereign wealth funds and hundreds of hedge funds with access to billions in capital.

The possibility of an attempted cornering of the silver market through buying and taking delivery of physical bullion remains real. However it would be very difficult to corner the silver market due to the very small nature of the silver bullion market.
A COMEX default remains a risk as does a massive short squeeze which could see silver surge as it did in the 1970s and again recently leading to silver targeting the inflation adjusted record high of $140/oz.
As ever price predictions from gurus should be take with a pinch of salt and diversification remains of paramount importance.

http://www.businessinsider.com/comex-registered-silver-bullion-inventories-fall-sharp-385-in-two-weeks--risk-of-comex-silver-default-remains-2011-6

Silver Market Update

originally published July 14th, 2011

Yesterday's high volume breakout above its 50-day moving average marked completion of the intermediate basing pattern and the start of the next major uptrend in silver. Everything in now in place for a substantial uptrend to develop in coming months that should take silver comfortably to new highs. Fundamentally yesterday's breakout was due to the realization in the markets that QE is set to continue, whether called QE or not, and in fact it must continue, as any attempt to apply the brakes at this late stage would result in a global systemic economic collapse. Hyperinflation will be the inevitable end result, as will prices for gold and silver at levels that many now would consider to belong solely in the realms of fantasy. We already had a foretaste of this coming ramp in Precious Metal prices earlier this year with the big runup in silver prices, before powerful interests decided the time was right to put the boot into the little guy by repeatedly hiking margin requirements over a short period. This served big money interests in 2 ways - first of all it crashed the silver price so that they can move in and scoop up more of it. Secondly big money is not all at concerned about margin requirements, since being wealthy in the first place they don't need to bother with margin at all, although it suits them to use it at times to maximise leverage. What the hiked margin requirements did do was to throw the little guy off the train, and like one of those old westerns big money is stood at the open end of the train carriage lighting up a cigar and grinning with satisfaction as the little guy rolls down the embankment and is left lying in the dust as the train chugs off into the distance without him.
Our 6-month chart for iShares, which is a good proxy for silver, shows the now extraordinarily bullish setup for silver. For some weeks it was not clear whether the C wave of the now completed A-B-C correction would take the silver price below the A wave low in May, which for iShares was exactly at $32, and had Greece not been bandaged up it would have, of course. The first sign of improvement was the breakout from the C wave downtrend channel about a week ago, after which the price was temporarily restrained by unfavorably aligned (falling) 50-day moving average, which forced a test of support at the top line of the channel, which we correctly anticipated. Then just yesterday the price blasted through the 50-day moving average on the highest volume for weeks, the importance of the resistance in the vicinity of this average being illustrated by the way the price gapped above it - a bullish "breakaway" gap. This is what we have been waiting for. This marks the end of the intermediate base building phase and the start of the next major uptrend. 

Continued
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Is The COMEX Manipulating Gold Margins To Mask Silver Supply Deficits?

The COMEX has just dropped the minimum margin requirement for gold contracts to $6,075 from its former $6,751 minimum.  This move does not make economic sense as the price of gold is now within 2% of its all-time high COMEX close.
The lower margin requirement also does not make sense when compared to the COMEX margin requirements for silver contracts.  With the lower margin requirements it is now possible to control more than $25 worth of gold for every $1 of margin put down on a gold contract.  In contrast, the silver contract minimum margin requirements are much higher.  At today’s closing silver price, investors could only control up to $8.30 of silver for every $1 of margin put down on a silver contract.
You have to remember that common sense and consistency aren’t the only factors that the COMEX considers when setting these requirements.  Could it be that the COMEX is trying to lure speculators and investors away from the silver market by offering them greater margin opportunities in the gold market?
Think about it for a minute.  By the end of this month, the next round of COMEX silver options will expire and the first day of notice for delivery of July 2011 silver contracts will occur.  Both of these events could trigger strong demand that could seriously deplete COMEX registered silver inventories.
On June 16, 2010, the COMEX had 119.5 million ounces of total silver in its bonded warehouses.  Since then, there has been a steady outflow of silver from these warehouses, especially of the registered silver that is available to fulfill contract deliveries.  Early this week, total COMEX silver inventories had fallen below 99 million ounces, a decline of more than 17% in the past year.  Even more important, the quantity of inventories that were registered had fallen to record low levels below 30 million ounces!  The remaining COMEX inventories are “eligible” which means that that they are owned by investors who are simply storing the silver in COMEX warehouses.  Eligible inventories cannot be used to fulfill COMEX contracts unless the individual owners choose to make them available for that purpose.
When the March and May 2011 COMEX silver contracts matured, a significant percentage of them were settled for cash, as is permitted under COMEX rules.  However, the cash prices that contract owners received were at levels reported to be as much as 30% higher than the prevailing spot prices!  Looking back at when the December 2010 COMEX silver contracts matured, it appears there may have been a larger than normal percentage of contracts that were settled for cash.
The sellers of COMEX contracts obviously would not be willing to pay up to 30% above the spot price to settle their liability for cash if they had the alternative of simply delivering physical silver.  The fact that comparatively little silver is being removed from COMEX registered inventories to fulfill maturing contracts is a significant indicator of a major physical supply shortage.
I don’t know if the COMEX reduced gold margin requirements in order to draw some leveraged investors away from holding maturing silver options and commodity contracts.  The timing is definitely suspicious.
Today was not a good day for the US government on multiple fronts.  The unofficial Misery index, which adds the Bureau of Labor Statistics official figures for unemployment and the rise in consumer prices stands at 12.7, which is the highest figure since 1983!  From June 1993 through May 2008, the Misery index had been below 10.  This index has been continuously above 10 since November 2009.
The news got worse from there.  At the International Monetary Fund press conference in Sᾶo Paulo, Brazil the United States was lumped with Greece, Ireland, and Japan as being the countries most in need of restoring their public finances to reasonable debt levels.
In a recent Bloomberg interview, former Federal Reserve Chair Alan Greenspan warned that a default by the Greek government could push the US back into a recession.  He further said that, “chances of Greece not defaulting are very small.”  He further emphasized the risk by saying that the risk of a Greek default was now “so high that you almost have to say there’s no way out.”
Today, Germany and France put together another bailout package for the Greek government.  There is widespread fear that Greece may default on its debt and start a domino effect of defaults much worse than experienced when Lehman Brothers collapsed in 2008.  In the commercial market, Greek companies are already paying 27% interest for 2-year loans, which is a rate so high that it almost assumes that a government default is inevitable.  Today’s bailout package did not cure the problem of the Greek government spending beyond its means.  Instead, dealing with the debt problem has been pushed a few months into the future.

Rest of article : LINK

COMEX WAREHOUSES REGISTERED SILVER - Exclusive Interactive Chart

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