Silver Report 260511

[pmbug]

May 11 AM Silver Market​

SFE Futures $91.01
SGE Spot $91.00 (~$11 premium to LBMA Spot)
COMEX May26 Futures $80.80 (EFP spread +$0.45)
LBMA Spot $80.49
MCX Futures $80.36 (below LBMA spot!)
IBJA PM Spot $79.65 (~$0.80 discount to LBMA Spot)

LBMA Spot ​

Sunday night silver crashed to ~$79, recovered, rose to ~$81.50 and fell back to where it started at ~$80 this morning.

EFP Spreads (ET)​

Spot price @ 06:54 : $80.49

May26 = +$0.45 vs +$0.06 Previously (spot @ 16:00 May 8 : $80.35)
Jun26 = +$0.29 vs +$0.24 (spot @ 06:52 : $80.52)
Jul26 = +$0.60 vs +$0.62

EFP Commentary​

May26 EFP spread closed last Friday hugely positive. I don't remember the last time the front month was this high. This negates any possibility for arb traders to take delivery of May26 silver and ship it to London at a profit.

India ​

MMTC-PAMP (retail) : $91.41 (less 10% taxes = $82.27)
MCX Jun26 [SILVERM 5kg] : $86.60 (less 7.2% taxes = $80.36)
MCX Jul26 [SILVER 30kg] : $85.91
IBJA PM spot : $83.84 (less 5% duty = $79.65)

I'm not seeing any signs of physical scarcity driving prices up with these numbers. Indian spot + futures are lower than LBMA + COMEX!

China ​

SGE $91.00(no VAT)
SFE $91.01

SGE premium to LBMA spot = ~$11
SFE premium to SGE = $0.01

No report today from @oriental_ghost, so I looked up the SGE Ag(T+D) and SHFE closing prices myself. I'm not entirely sure which SHFE contract Bai tracks. I chose the first one in the list (nearest month I believe).


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May 11 AM Silver Vaults (ozt)​

SFE1.1M

SFE run rate

SFE Run Rate​

1.1M ozt (33t)
Remaining Vault Stock = 27,181,240 ozt

"Withdraw" rate through last 5 days = 690K/day deposit!

Run rate =

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Previous report: https://www.pmbug.com/threads/silver-report-260509.8913/

 

[Voodoo]

I wonder if the EFP spread going positive corresponds to when they try and start refilling the SLV slush fund... It definitely correlates with positive movement IMO.

 

[pmbug]

Generally, a large (positive) EFP spread means there is an arbitrage profit to be made by buying LBMA spot (low) and shipping to USA to sell to COMEX (high). It should be pressuring the LBMA (which needs SLV's London vault stock).

JPM maintains vault stock for SLV in both the LBMA and COMEX vaults, so it is unclear if the EFP spread at any time really helps or hurts JPM (directly) manage the stock. I think the EFP spread is more of a signal for arb traders (presumably bullion banks) moving silver from one shore to the other. Positive EFP spread = UK to USA. Negative EFP spread = USA to UK

 

[pmbug]

Bai posted his report a bit late this morning. I was a bit off on the SHFE price. I'm not sure where he pulled 19,929 from - I can't find it on the SHFE site.

 

[pmbug]

Re: EFP spreads