Silver becomes a defense metal: Silver North, Rheinmetall, Siemens Healthineers

Silver with a supply deficit: Now comes the arms shock

Silver has always occupied an intermediate position between precious and industrial metals. Cheaper than gold, silver is used in PV modules and medical technology devices. Siemens Healthineers relies on silver primarily for electronic imaging systems such as X-ray tubes, MRI coils, and laboratory equipment. With an aging population and growing demand for precision medicine, the medical technology sector is expanding, which indirectly supports demand for silver. Studies show that silver helps reduce the number of post-operative infections in medicine thanks to its germicidal properties.

In 2024, silver demand was significantly higher than supply at around 1.17 billion ounces, resulting in a deficit of around 130 million ounces. This was primarily driven by the photovoltaic and electronics industries: an estimated 220 million ounces of silver were needed for solar modules in 2024, compared to only around 90 million ounces in 2021, according to LBBW. The state bank LBBW expects the price of silver to reach USD 30 by the end of 2025. However, the figures for 2024 barely take into account the boom in defense spending.

A Tomahawk missile contains up to 500 ounces of silver

Many modern weapon systems contain extensive electronics: radar stations, drones, and missiles require particularly pure silver due to extreme requirements. A Tomahawk missile can contain up to 500 ounces of silver. The German defense contractor Rheinmetall also relies on silver. Its Electronic Solutions division, which specializes in communications, sensor technology, air defense, and IT systems, is particularly dependent on the precious metal.

Silver North: Pure silver company with projects in the Yukon

The existing supply deficit and continued dynamic demand from the defense industry are driving interest in new silver projects. The Canadian company Silver North focuses on silver projects in the Yukon. The Haldane project is located in the immediate vicinity of Hecla Mining's mine projects and is considered underexplored – only 27 drill holes have been completed to date. However, these have yielded some outstanding results. Examples include 311 g/t silver over a distance of 8.72 m or 151 g/t over 7.6 m. At the Tim project, Silver North benefits from its collaboration with Coeur Mining, which is bearing the exploration costs.

As both projects have been inadequately explored to date, comprehensive drilling results are expected in the coming months. Given the already promising starting position, the chances are good that the Company will identify relevant deposits. As a pure silver company with industrial partnerships and a robust shareholder structure, Silver North could become a sought-after investment target. This is all the more true if the rising demand for silver from the defense sector is also reflected in official silver market data. In June, Silver North's management itself held around 25% of the shares, with funds and wealthy individuals remaining important anchor shareholders. Around 53% of the shares are held by private investors.

Exploration ahead – Market shows growing optimism for Silver North

With a market capitalization of around CAD 13 million, the Company is moderately valued. Silver North recently expanded a CAD 2.1 million capital increase by an additional CAD 500,000 to carry out further exploration activities. Silver North's stock reacted favorably to the capital increase. The importance of silver in the defense industry is also increasingly coming into focus for the market. The stock recently reached a new intraday high.