HSBC has quietly amassed large amounts of silver bullion, according to a report from precious metals dealer report GoldCore.
In fact, HSBC has purchased silver from one large producer alone worth $876 million in the past year.
The producer, KGHM Polska Miedz, is second-largest producer of refined silver in the world. It acknowledged the deal with HSBC in a filing earlier this week, according to GoldCore.
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“The criteria used for describing the contract as significant is that the total estimated value of the contracts exceeds 10 percent of the equity of KGHM,” KGHM said in a statement.
James Steel, chief precious metal analyst at HSBC, recently said that “silver tends to track gold, except it overperforms in a bull market.”
Steel said he is “moderately bullish on silver in 2013.” According to CNBC, HSBC recently trimmed its gold price forecasts for this year to $1,760 an ounce from $1,850 previously.
Earlier this month, Steel told the Financial Times that palladium was his top pick among the precious metals.
GoldCore acknowledged it is a possibility HSBC could simply be securing supplies of silver because it is the custodian for the NYSE listed ETFS Physical Silver Shares exchange-traded fund.
“Or it could be that senior people in HSBC are concerned about securing supply as they expect robust investment demand to continue and possibly increase resulting in higher prices,” GoldCore wrote.
GoldCore noted the U.S. Mint recently sold out of 2013 American Eagle silver coins and is awaiting fresh inventory. It said analysts believe Chinese investor interest in silver as a cheaper alternative to gold is continuing to rise.
“There are also rumors that Apple is experiencing delays in producing the new iMac due to difficulty in sourcing industrial silver in volume in China,” GoldCore said.
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