Defense and aerospace silver consumption is real, growing, and entirely absent from the standard supply-demand models. Here is what the data actually shows.
Silver's most cited supply-demand figures come from the Silver Institute's World Silver Survey, the industry's authoritative annual report. It breaks demand into solar, electronics, jewelry, silverware, photography, brazing alloys, and a handful of other categories. Defense and aerospace do not appear anywhere in it.
That absence is not a rounding error. It is a structural gap in the most widely used data set in the silver market. With the Iran war putting missiles, drones, and military electronics in the news daily, it is worth examining precisely what the available data actually supports, including a correction to a per-unit figure that has been overstated in silver analysis for years.
There are seven Deep Dives that I'm discussing in this week's premium Silver Catalyst issue, and in this article, I'll focus on one of them.
The Demand Layer No Government Will Count
A subscriber asked a question that cuts to an honest gap in the silver data: how much silver does the defense and aerospace sector actually consume, and is that number growing?
The direct answer is that no government agency, no independent research firm, and no industry body publishes a standalone figure for defense and aerospace silver demand. The USGS Mineral Commodity Summary reports US silver use by broad sector (electrical/electronics, solder, other industrial) with no military line item. The Silver Institute's World Silver Survey has no defense category. Five US government agencies, including the Department of Defense, stopped reporting silver usage data in 1995–96 without explanation.
That absence of data is itself meaningful. When five agencies cease reporting simultaneously on a commodity that is simultaneously being added to the US Critical Minerals List, the silence is informative rather than random.
What the public record does confirm, without quantifying the aggregate:
Silver-zinc batteries power guidance, telemetry, and actuation systems across Tomahawk, Patriot, THAAD, Hellfire, and Standard Missile programs. EaglePicher, the dominant US military battery supplier, confirms this directly. The chemistry is not US-specific: silver-zinc cells purpose-built for combat torpedoes appear in German, French, Italian, Indian, and Russian naval specifications. Single-use applications (fire and discard) mean no recovery and no recycling.
Silver-plated connectors, wiring harnesses, and circuit boards run throughout military avionics under mil-spec QQ-S-365 requirements. The reliability standard for defense electronics, where failure means loss of aircraft, crew, or mission, is the primary reason silver remains specified rather than substituted.
One widely circulated figure worth correcting: the 480–500 oz of silver per Tomahawk cruise missile that appears frequently in silver analysis has been directly disputed by CPM Group, one of the most rigorous and skeptical precious metals research firms. Their published analysis puts the actual figure at closer to 10–15 oz per Tomahawk, primarily in solder and an ignition battery. Smaller missiles used in Ukraine, the Middle East, and similar conflicts reportedly carry less than 1 oz each. CPM estimates cumulative silver consumed in all Tomahawk missiles fired over forty years at approximately 32,000 oz total. This is an important correction. Overstating per-unit silver loadings undermines the credibility of the underlying demand case, which is real even at accurate numbers.
The honest estimate, applying CPM's per-unit frameworks and available defense electronics production data, puts global defense and aerospace silver demand at approximately 15–40 Moz annually, embedded within the Silver Institute's broader "electrical & electronics" and "other industrial" categories without attribution. That range is wide because the data is structurally thin. It is not in the 67 Moz structural deficit projection, since it cannot be disaggregated from the broader figures.
The Forward-Looking Case
Even without a confirmed baseline, five structural drivers point to defense silver demand growth from here:
Global defense spending at record levels. Global defense spending reached $2.63 trillion in 2025, with NATO members hitting the 2% GDP target and pledging to ramp to 5% by 2035. China's 2026 defense budget is approximately $275 billion, up 7%.
Drone proliferation at scale. Military drone markets are projected for significant growth through 2030, with single-use loitering munitions multiplying unit counts across all major armed forces. Each drone carries silver in electronics and guidance systems. Volume multiplication matters even at modest per-unit loadings.
Missile restocking. The restocking pipeline is active across NATO and allied nations. At even CPM's 10–15 oz per unit, procurement at wartime replacement rates adds up across hundreds of thousands of units in active inventories.
Hypersonic competition. Russia and China are fielding hypersonic systems that are forcing NATO to accelerate its own programs. Silver is used in the thermal control and sensor electronics of these platforms, an application class that did not exist at meaningful scale a decade ago.
Project Vault. The Trump administration's $12 billion strategic minerals stockpile, backed by $10 billion in EXIM Bank financing, covers all 60 USGS Critical Minerals, a list that now explicitly includes silver. A formal government procurement channel for silver now exists that did not exist a year ago.
At even conservative per-unit loadings, volume multiplication at current procurement rates adds up across hundreds of thousands of units in active inventories and restocking pipelines. The 15–40 Moz honest estimate is likely an undercount. It is also the number we can defend from public data. What we cannot do is ignore this demand layer because it cannot be precisely measured. The structural case for growth is clear even when the baseline is not.
This is the central discussion for Catalyst #82: Military Electronics Demand Acceleration from "Silver Rising".
The full Silver Catalyst Issue #11 covers six more Deep Dives beyond this one, including the Phase 1/Phase 2 framework for oil shocks and what the 1979 precedent predicts follows the current correction, the extraordinary event inside the COMEX delivery system on March 19, Turkey's 20.34 Moz physical import surge, the Section 301 investigation calendar, Micron's record Q2 results, and the peer-reviewed 2030 solar supply gap model. This is where the timing and the structural picture come together.
If you want to see the full analysis and what it implies from here, you can access it below:
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Thank you.
The Silver Engineer