Silver has been mined for thousands of years. But for most of the 20th century it was the poor man’s precious metal, its value eclipsed by the enduring lure of gold.

The first big revolution in silver came in 1492 with the discovery of the New World, which opened up mining of the metal on a scale not previously seen. In the centuries that followed Hernán Cortés and the conquistadors’ destruction of the Aztecs, Peru, Bolivia and Mexico accounted for three-quarters of all world production and trade in the metal.

Today, more than 877m ounces of silver are mined annually and the metal is increasingly being employed in new industrial processes. A major catalyst for demand over the next decade will be in the production of solar energy.

Silver is a key component in crystalline silicon photovoltaic (PV) cells. According to IHS, demand for solar power is set to increase by 30pc to 57 gigawatts of electricity in 2015. China alone is expected to install something in the region of 17 gigawatts of solar capacity by the end of the year, creating huge potential demand for silver.

David Fuller's view

This is the first bullish news that I have heard about silver since it peaked near $50 just over four years ago.

Silver (weekly 5-year & 10-year) is certainly much cheaper but it also has a long sequence lower rally highs, so it has yet to break its overall downward trend.  The best thing that could occur for investors looking to buy is another climactic downside overshoot.  However, there is a possibility that this may have already occurred between July and the 1^st of December 2014. 

For subscribers with an interest in commodities, I would keep an eye on silver, which has been transforming from one of the most loved to most hated resources.  With or without another selloff, silver is arguably cheap; production may be slowing, and growth in solar power is the next big bull story for this precious metal.