China Silver Inventory Continues Depleting at an Alarming Pace (5.2% Out In One Day) While Shanghai Silver Premium ~13.5% Above Western Silver Prices, COMEX Silver Inventories Down 22% From Their Peak

China Silver Inventory Depleting at an Alarming Pace

This is demand signaling real physical scarcity, not paper speculation.

The global debt super-cycle has masked fundamental shortages for years — but as trust in financial collateral erodes, physical supply constraints become the true price driver.

China’s depletion is actual metal leaving vaults, meaning storage + availability are tightening — a direct crack in the supply layer beneath the financial system.

Silver Vanishing — 5.2% Out in One Day in China

Rapid diminution of available metal is physical demand dominating price discovery — exactly what happens when the financial system’s paper claims are losing their anchoring power.

When metal disappears from inventory, paper contracts can no longer be honored easily — and pricing must migrate toward where real settlement happens.

Shanghai Silver Premium ~13.5% and Silver On Track to $200

This is a decentralized price signal.

Eastern markets (China) clearly value silver at a higher real physical price than Western benchmarks like LBMA or COMEX.

A persistent premium means Western paper markets are disconnected — not because they are right, but because they are detached from physical reality.

This is collateral repricing, not cyclical speculation.

Not VAT tax — real premium.

This highlights a core structural weakness:

Western markets still try to dismiss physical pricing discrepancies as “arbitrary” or “technical.”

That’s exactly how suspended dysfunction shows up — denial of real fundamentals.

But the market can only ride on narratives for so long.

Eventually real shortages and real delivery signals are what matter — and Shanghai is the market more driven by physical demand.

COMEX — Registered to Eligible Movements

This is a classic red flag in the paper market. 

Registered inventories are what are actually deliverable against futures contracts at any point in time.

When registered stock is drained, it means:

• Sellers are refusing to leave metal in deliverable form.

• Physical metal is being hoarded or moved away from settlement pools.

• Futures are increasingly unbacked by actual silver.

That is the paper market unravelling — a foundational crack in the base layer of global finance.

COMEX Silver Inventories Falling Dramatically

This is not a coincidence.

It is systemic feedback — strong physical demand is draining inventories faster than speculation can fill them.

This means:

• Backwardation becomes possible.

• Arbitrage breaks.

• Physical price signals overpower financial signals.

• Repricing accelerates.

This is exactly how a collateral swap begins: when physical assets become more credible than sovereign debt claims.

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Luke Lovett
Cell: 704.497.7324
Undervalued Assets | Sovereign Signal
Email: [email protected]

Disclaimer:
This content is for educational purposes only—not financial, legal, tax, or investment advice. I’m not a licensed advisor, and nothing herein should be relied upon to make investment decisions. Markets change fast. While accuracy is the goal, no guarantees are made. Past performance ≠ future results. Some insights paraphrase third-party experts for commentary—without endorsement or affiliation. Always do your own research and consult a licensed professional before investing. I do not sell metals, process transactions, or hold funds. All orders go directly through licensed dealers.