Silver Slides 4% to $61.63 But Industrial Demand Story Remains Intact

Silver fell 4.07% to US$61.63 per ounce on September 28, 2026 — equivalent to approximately C$87.15/oz at the prevailing USD/CAD rate of 1.4143 — as broader precious metals sold off sharply alongside gold, which tumbled 3.30% to US$4,178.60/oz. The single-session pullback was steep, but analysts caution against reading it as a structural reversal: silver’s industrial demand fundamentals remain among the most compelling in the commodity complex.

Gold/Silver Ratio Widens, Signalling Relative Underperformance

The gold/silver ratio climbed to approximately 67.8x on Monday’s close — calculated by dividing gold’s US$4,178.60 price by silver’s US$61.63 — up from recent readings closer to 65x. Historically, a ratio above 80x has signalled silver is deeply undervalued relative to gold, while readings below 60x have coincided with silver outperformance cycles. At 67.8x, silver sits in a neutral-to-cheap zone, which contrarian investors often treat as a buying opportunity. The ratio’s recent widening reflects silver’s larger single-day percentage loss, a pattern common when risk sentiment deteriorates and silver’s industrial component drags it down faster than pure monetary metals.

First Majestic Silver: A Canadian Bellwether Under Pressure

First Majestic Silver (TSX: AG), Canada’s most prominent pure-play silver producer, is among the stocks most directly exposed to today’s price action. The Vancouver-based company operates primary silver mines in Mexico and Nevada, with silver and silver-equivalent ounces accounting for the majority of its revenue mix. A 4% drop in spot silver compresses margins meaningfully for a producer whose all-in sustaining costs (AISC) have historically hovered in the US$17–$20/oz range for silver-equivalent production — though at current prices above US$60/oz, the company retains substantial operating leverage even after today’s decline. First Majestic’s stock typically amplifies silver’s moves by a factor of two to three, making it a high-beta vehicle for investors with a constructive view on the metal’s medium-term trajectory.

Supply Deficit Still the Structural Anchor

According to Silver Institute data, the global silver market recorded a structural supply deficit for the fourth consecutive year in 2025, with above-ground inventories drawn down as industrial fabrication demand — led by photovoltaic (solar panel) manufacturing — continues to outpace mine supply growth. Solar alone consumed an estimated 232 million ounces of silver in 2025, a figure projected to rise further as governments accelerate renewable energy buildouts. Mine supply, meanwhile, has been constrained by permitting delays, grade declines at mature operations in Mexico and Peru, and ongoing geopolitical friction in key producing regions. Pan American Silver (TSX: PAAS) and MAG Silver (TSX: MAG) are among the Canadian-listed names navigating these supply-side headwinds while developing or expanding assets in the Americas.

Outlook: Dip or Deterioration?

Today’s selloff appears technically driven rather than fundamentally motivated. No major demand destruction event — such as a collapse in solar panel orders or an automotive production slowdown — was reported to justify a move of this magnitude. Short-term traders may be booking profits after silver’s strong run above US$60/oz, a level that was a ceiling for much of the prior decade. For Canadian retail investors holding silver miners or physical silver ETFs, the more relevant question is whether the four-year supply deficit persists — and the current data suggests it will. Barring a sharp global growth shock, the industrial demand floor beneath silver prices remains structurally higher than it was even two years ago.