Silver Inventories on COMEX Plummet Below 80 Million Ounces: Implications for the Market

Silver Inventories Plummet Below 80 Million Ounces, Heightening Risk of Physical Delivery Squeeze

As of May 12, COMEX registered silver inventories stood at 79,968,749.314 ounces, marking a sharp 41% decline from the 532 million ounces recorded in October 2025. This significant drop in registered silver inventories has sparked concerns about a potential physical delivery squeeze in the global silver market.

The total combined inventory on COMEX, including both registered and eligible silver, stood at 313,175,311.832 ounces as of May 12. However, the decline in registered silver inventories has raised alarms, with analysts warning that the current level of 80 million ounces is a critical turning point for the global silver market.

A Critical Turning Point for the Global Silver Market

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Since the 'Silver Squeeze' began in 2021, the decline in COMEX registered silver inventories has been significant, representing a drop of more than 45% in the actual metal available for delivery to buyers. This shift has transformed silver from a surplus commodity into one characterized by a chronic shortage, according to Vandana Bharti, Research Head – Commodity at SMC Global Securities.

COMEX silver inventory refers to the physical silver stored in vaults approved by the CME Group, which serves as a backing for silver futures contracts traded on COMEX. The inventory is broadly classified into two categories: registered silver and eligible silver. Registered silver carries a warrant and is readily available for delivery against futures contracts, while eligible silver meets COMEX specifications but is not currently warranted for delivery.

Stress Zone and Liquidity Squeeze Risks

The current coverage ratio – physical silver versus paper contracts – has tightened to 15.4%, with nearly 6.5 paper claims for every ounce of physical silver. Analysts warn that even a modest increase in investors seeking physical delivery could trigger a liquidity squeeze, leading to parabolic price spikes.

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Indian Market Outlook

In the Indian market, the ongoing physical tightness and robust global demand could push MCX silver prices towards ₹3.20 lakh per kg on the higher side, according to Bharti. With industrial demand remaining strong, the structural deficit in silver is no longer merely theoretical – it is a reality reflected in depleted vault inventories.

Silver Price Outlook

If silver delivery requests exceed 10% of the registered inventory in a single month, COMEX silver prices could move towards the $95–$100 per ounce range, according to Bharti. The structural bullish outlook for silver remains intact, with analysts predicting that the decline in COMEX silver inventories below 80 million ounces will lead to a sharp rally in silver prices, potentially pushing them towards $98–$110 per ounce.