Editorial: The Wisdom of Sore Heads

Adrian Ash

By Adrian Ash
Director of Research, BullionVault

Let’s face it, the LBMA Conference in Lisbon didn’t face a high hurdle to top the previous two years’ events. Welcome, engaging and valuable as those virtual Conferences proved, the return of a proper event – with real people! in the same room! with drinks and then dinner! – was always going to feel special.

But Lisbon 2022 far surpassed that target I believe, delivering a deluge of data, news, views and expert discussion which raised the bar for future events. On behalf of the Public Affairs Committee (which brainstorms and builds the programme of speakers) as well as the LBMA Executive team (whose dedication makes the Conference happen), I hope that every attendee found it equally informative, enjoyable and productive.

If you weren’t able to join, then it’s hard to pick a stand-out insight to share. In terms of numbers, perhaps the most welcome statistic was the near-record crowd of 771 attendees, who were finally able to gather, meet and do business in person for the first time since 2019’s event in Shenzhen.

That warm glow was surely beaten however – at least for logistics providers, if not for their customers – by the 25 cents per ounce being paid by dealers in India this year to have silver delivered in two days by air, rather than paying 5 cents and waiting a month for sea freight. Mark Wooley (Brink’s Global Services) – who won best speaker – explained that the subcontinent’s surging consumer and industrial demand has spurred record imports, matched by massive outflows of silver from London vaults.

Silver also beat gold in terms of excitement and interest, both in the Conference hall and at the bar. Indeed, the Lisbon delegates’ average gold price forecast for when we next meet (Barcelona, 15-17 October 2023 – book early) projected only a 10% rise in dollar terms – the least bullish consensus since we met in Singapore in 2016. Silver, in contrast, will trade 52% higher according to the average delegate’s forecast from Tuesday afternoon’s closing session, way up at $28.30 per ounce.


The wisdom of sore heads, perhaps, after Monday night’s gala dinner? Given the bearish outlook I got from chatting with analysts and other market experts, the crowd in Lisbon must have included some heroic bulls to offset those more downbeat forecasts and push the Conference’s average silver prediction so much higher.

Not that analysts called it right on silver for 2022. The average predictions for the metal’s year-average price back in January’s LBMA Forecast competition were out by $2 per ounce compared to the outcome to date. But with that average falling to just $21.60 so far this year, down 14% from 2021’s nine-year high, the expert consensus was too bullish 12 months ago, not too bearish.

Might the grey metal’s newly energised fans see it reach higher ground in 2023? The latest LBMA webinar, available to watch whenever you’re free, replays and expands on the excellent Silver Roundtable discussion I joined in Lisbon, looking at supply and demand, those huge outflows from London storage and the impact of hot-money traders burnt this year by the steepest rise in dollar interest rates since the start of the 1980s.

For more from this year’s Conference, this edition of the Alchemist also relays the big-picture analysis and outlook from the Macro and Geopolitical panel, and Peter Boyd of the Yale Center for Business and the Environment explains why he flew across the Atlantic to tell the LBMA Members gathered in Lisbon about the true urgency of climate change.

Silver also gets a starring role in this issue of the Alchemist via Simon Rostron’s history of the Comstock Lode, the largest deposit of high-grade silver in North America. Stewart Murray also steps into the archives, examining the original Great Train Robbery of 1855, while Federico Gay of Refinitiv reveals how gold makes football’s World Cup the most valuable trophy in sport.

Will 2023 see the gold in that trophy grow more valuable still? Gold prices in all major currencies rose to new record annual averages this year, including a fresh high of $1,801 per ounce in dollar terms – exactly the average of the 28 entries in January’s LBMA Annual Precious Metals Forecast Survey.

Skill, luck or the wisdom of (expert) crowds? Don’t miss the Forecast next month for detailed analysis and price predictions from across our industry for gold, silver, platinum and palladium.

Adrian Ash

By Adrian Ash
Director of Research, BullionVault

Adrian is director of research at BullionVault, the precious metals market for private investors online and by smartphone.