Elon Musk has raised the alarm for manufacturers after silver prices surged to record highs in late December.
Precious metals like gold, silver, and platinum – often seen as a hedge for investors – have rallied this year, amid a mix of geopolitical risk driving investors to safe-haven assets and expectations of easing Federal Reserve policy in 2026.
But silver has been in the drivers’ seat during the festive month ahead of fresh restrictions on exports from China which start on Jan. 1. That has caused already high demand for the metal to combine with supply fears to send it soaring.
Silver hit a record $80 an ounce on Friday Dec. 26, up from just $29 an ounce at the start of 2025 and marking a 179% year-to-date rise. It then retreated 5% on Monday, in a rare moment of volatility for a previous metal asset.
Responding to a post on X about Chinese export restrictions, Musk wrote: “This is not good. Silver is needed in many industrial processes.”
Silver is a workhorse in energy and tech. It forms the conductive layer in solar panels and is used in the wiring and electronics of electric cars. It also helps keep data centers running smoothly, appearing in contacts and circuit boards that manage power and processing. All of those industries could be hit if prices rise too high and for too long.
China’s upcoming export limits come as part of its plan to gain more control over strategic minerals. Musk’s comment also points to the growing attention that investors, commentators, and ordinary market observers are paying to the asset.
“Make no mistake: we are witnessing a generational bubble playing out in silver,” said Tony Sycamore, a market analyst at IG Australia. “With new mines taking up to 10 years to develop and capital being drawn into the precious metals bubble like a moth to a flame, it is impossible to say when the air might come out.”
“The dominant driver of late has been a severe structural supply-demand imbalance in silver, sparking a scramble for physical metal,” Sycamore added. “Buyers are now paying a remarkable 7% premium for immediate delivery compared to waiting a year.”
Gold has also had its best year since 1979, rising more than 70% to more than $4,500 an ounce from $2,623 at the start of 2025.
