UBS: Silver supply gap drops sharply from 300 million ounces to 60 million in 2026, with silver price targets lowered across the board According to a report by Golden Finance, on May 15th, the latest silver forecast released by UBS Group (America) strategists showed that due to weakened investment demand, softer industrial consumption, and increased mineral supply, the supply gap of silver will significantly narrow, which weakens the upward potential of silver in multiple time dimensions. UBS strategists Wayne Gordon and Dominic Schnider wrote in a report, "For 2026, we expect demand in the photovoltaic sector to weaken due to high prices; similarly, higher prices also suppress demand for silverware and jewelry. Overall, we estimate that these channels will reduce demand by approximately 50 million ounces Turning to investment demand, UBS analysts pointed out that the total holdings of known exchange traded funds (ETFs) have decreased by nearly 70 million ounces, to about 794 million ounces, while net speculative futures positions have also retreated to a level slightly above 100 million ounces. In response, the bank lowered its annual investment demand forecast from over 400 million ounces to 300 million ounces, stating that this forecast is still generous considering the outflow of funds so far this year. The bank currently predicts that the silver price at the end of the second quarter of 2026 will be $85 per ounce, lower than the previous forecast of $100. The target price for September has also been lowered from $95 to $85, the year-end target price has been lowered from $85 to $80, and the forecast for March 2027 has been lowered from $85 to $75. This adjustment is based on a reassessment of the overall supply-demand imbalance in the market. UBS now expects the supply gap in the silver market to narrow to approximately 60-70 million ounces by 2026, a significant decrease from the previously estimated 300 million ounces. Strategists say: Consistent with the smaller supply gap, we have lowered our price outlook for all forecast time periods. In our baseline scenario, we expect silver prices to roughly trend sideways