Fast Growing AI Sector to Boost Silver Industrial Demand Over Next Five Years

[Ben Graham]

Not long ago, artificial intelligence felt like science fiction—something you read about in a book or saw in a movie. Today, it’s become a part of our daily life.

From asking a voice assistant for the weather, to the way streaming platforms tailor our playlists, or how cars navigate traffic on their own, artificial intelligence is behind the scenes powering these moves.

For precious metals investors, it’s noteworthy to see that as AI technology expands throughout our economy, it is increasing industrial demand for silver—and that’s expected to grow significantly over the next five years, according to a new report by London-based Oxford Economics

Silver: An Essential Component in AI Computing

Today’s new artificial intelligence systems need materials that can handle extreme electrical loads and thermal stress far beyond conventional computing applications—and that’s where silver comes in. Silver is playing a critical role in the AI hardware revolution thanks to its unmatched electrical and thermal conductivity.

Consider silver’s physical attributes:

Electrical conductivity: Silver possesses the highest electrical conductivity of any metal at 63.01 million siemens per meter. That makes it the top choice for high-frequency applications in AI hardware.

Thermal management: AI processors generate thermal loads that far exceed conventional computing, which means advanced heat dissipation capabilities are crucial. Silver’s thermal conductivity rating of 429 W/m·K represents the highest of all metals. Silver provides heat transfer that is 7% better than even copper.

In data centers that run AI models, silver is used in high-performance chips like GPUs and TPUs for internal connections, packaging, and semiconductors, ensuring efficient data processing without overheating. These massive facilities, often consume as much power as small cities, and rely on silver-plated connectors and switchgear to distribute electricity reliably and safely at high voltages.

AI Data Centers are Driving New Industrial Silver Demand

Global electricity demand from data centers is expected to more than double by 2030, largely because of AI workloads, according to the International Energy Agency (IEA).

Looking forward, the acceleration of digitalization and the widespread adoption of AI are expected to continue gathering pace, placing growing demands on both digital and physical infrastructure. As AI applications diversify into media production, design, and simulation, demand for servers’ processing power and, by extension, data center infrastructure is expected to continue growing, the Silver Institute said.

As the world pivots toward the adoption of AI into nearly every industry, silver is poised to play a critical role as a “next generation metal.”

Is It Time to Increase Your Allocation to Silver?

Silver is in high demand as a monetary metal and for its extensive industrial uses. That demand is forecast to grow in the years ahead. With silver poised to climb in 2026 as high as $65 or even $70 an ounce according to forecasts from Bank of America and a bullish forecast from Citi—the question becomes do you own enough?

How much silver you should allocate to your portfolio depends on your risk tolerance, time horizon and your existing exposure to physical metals.

If you allocate 15% of your portfolio to precious metals, most mainstream portfolio modeling suggests that silver could comprise 40-60% of that slice with the remainder in gold. None of these are hard rules and it’s always worth exploring your personal situation with a Blanchard portfolio manager who can provide unique guidance tailored to your financial goals. But the evidence is clear. It’s prudent to treat silver as an important component of your diversified portfolio plan.

Ready to get started today? Explore silver investment options here.

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