Editor’s Note
This account describes an unusual directive to halt all silver purchases from within the precious metals industry, suggesting potential market stress or a significant supply disruption. The source, while anonymized, is a career professional with direct access. We are monitoring this developing situation.
On Friday, October 10, late in the morning, I received a phone call from a friend who has spent her entire career working for a subsidiary of a major precious metals group.
This friend received an email from her former employer on Friday morning, instructing her to suspend all silver purchases, regardless of quantity.
Surprised by such a directive—a first in her experience—she immediately contacted the group’s headquarters for confirmation and an explanation.
On Friday morning, silver London Lease Rates had breached the exceptional threshold of 125%—UNPRECEDENTED!
When a trader from the group buys metal, it is leased at the official London Lease Rates until it is resold.
My friend then contacted her counterparts in the market: they had all received, at the same time, the order to suspend their silver purchases on Friday.
I confirmed this information while browsing the internet: other refiners have also suspended all their silver purchases.
The market was therefore completely frozen.
Normally, silver lease rates, like those of gold, hover around 0.25%.
On Thursday, October 9, silver rates reached 39.17%:
Before soaring to over 125% on Friday…
This movement could indicate that some traders sought to exploit the sharp rise in silver prices in London by engaging in short sales, in other words, selling metal they did not own. The near-universal refusal to lend silver, except at rates approximately 600 times the average, suggests the occurrence of a major short squeeze.
On Friday, the London spot market remained frozen around $50, while COMEX futures contracts in New York experienced a slight correction. This Monday, October 13, Silver prices in New York and Shanghai now seem to have aligned with those of the London spot market.
Regardless of what you may have read from financial analysts over the past 3 days, remember these undeniable facts:
1. Chinese Government directives dated June 23, 2025 to develop gold and silver mining:
Promote a new cycle of strategic actions to achieve breakthroughs in exploration;
Promote exploration in the deep and marginal areas of existing large and medium-sized mines;
Promote the expansion of capacities of operating mines, the production of mines under construction, and the construction of new mines;
Strengthen the comprehensive utilization of low-grade, difficult-to-treat, and co-existing resources;
Improve the recovery rate of gold, silver, and associated precious elements;
Encourage the development of secondary resources in gold tailings basins;
Promote the recycling of gold and silver such as from discarded electrical and electronic products;
Improve the gold recycling market system;
Strengthen the coordination and cooperation of fiscal, financial, investment, import, and export policies with industrial policies;
Use existing financing channels to support the development of key technologies in the gold and silver sector.
In other words, the goal would be to raise the price of gold and silver to make all these operations economically justifiable.
2. Donald Trump’s Executive Order dated March 20, 2025 to restart mines and their funding:
In 2025, the USGS—the United States Geological Survey—listed silver on the “critical essential minerals” list:
This list published by the USGS on August 26, 2025, includes copper, lead, silver, and zinc. It should be recalled that nearly 70% of global silver production actually comes from copper, lead, and zinc mines.
3. The G7 directives dated June 17, 2025 to develop mines for “critical minerals essential to digital and energy economies”:
There is therefore an international agreement aimed at developing the exploitation of these critical minerals, whose deposits tend to be depleted.
As our article on Mining Industry cycles reminds us, it takes an average of ten years between the discovery of a deposit and the start of production at a new mine.
Between the government directives mentioned above and the arrival on the market of the volumes of silver necessary for digital and energy projects, a phase of aggravated shortage seems inevitable. This could last several years, leading to a sharp rise in the price per ounce of silver.
