Tesla CEO Elon Musk has expressed concern over the recent surge in silver prices and the potential impact of China’s new export rules on the global market. In a post on the social media platform X (formerly Twitter), Musk wrote simply, “This is not good. Silver is needed in many industrial processes.” His comment reflects worries that higher costs and limited silver supplies could hurt industries that rely on the metal.

Silver prices have been rising sharply in global markets. The white metal reached a record high of $78.65 per ounce by Friday, December 26, 2025. The increase in prices has been steep and sudden, driven by concerns about supply shortages and changes in export policy from China, which controls a large portion of the world’s silver supply.

Musk’s reaction on X came after another user shared a post showing how silver prices appeared to be “exploding” due to what was described as a severe global supply shortage. Musk’s brief comment, “This is not good”, was in direct response to that post, and it stressed that silver is a critical material for many manufacturing sectors.

China is planning to introduce new rules on silver exports starting January 1, 2026. Under these rules, companies wishing to export silver will need to obtain a government license before they can sell the metal overseas. This means exporting silver will no longer be automatic — only approved exporters will be allowed to ship it to other countries.

According to the post shared in the discussion that Musk replied to, only certain companies will qualify for these new licenses. Those include firms with at least 80 tonnes of annual silver production and a minimum of $30 million in credit lines. Smaller companies may be unable to meet these conditions, which could reduce the number of exporters in the market and tighten global supply.

China is believed to control roughly 60–70% of the world’s silver supply. Because of this, changes in export policy from China tend to have a big impact on global silver availability. The stricter export requirements may limit the amount of silver leaving China, which could push prices even higher.

Silver is not only a precious metal used for investment. It also has many industrial applications because it conducts electricity and heat very well and is chemically stable. The metal is used in a wide range of products, including- Solar panels, Electric vehicles, Electronics and Medical devices

These industrial uses are said to make up a large share of total silver demand. Because there is no easy substitute for silver in many of these applications, industries must rely on real physical metal. This means that when supply is tight and prices rise, it can create challenges for manufacturers. The post Musk responded to explained that silver has been in a structural deficit for several years — meaning that demand has been higher than supply.

In 2025, global demand was about 1.24 billion ounces of silver, while global supply was around 1.01 billion ounces. This left a gap of 100–250 million ounces. That deficit is expected to get worse with the new export controls from China.

The amount of physical silver stored in major global warehouses is also shrinking. According to data shared in the original report, COMEX inventories have dropped by about 70% since 2020, London vaults have fallen by roughly 40% and Shanghai inventories are at 10-year lows.

With less silver available in inventory, buyers are paying higher premiums to obtain actual physical metal for delivery. At the same time, prices in physical markets like Shanghai are sometimes higher than prices in paper or futures markets. This shows that real silver is becoming harder to secure.

Because silver is so important to many industrial processes, Musk’s concern reflects a larger fear that rising prices and restricted availability could affect manufacturing costs. Products that use a lot of silver, such as electronics and renewable energy systems, could become more expensive to produce if silver prices remain high.

While Musk’s statement was brief, it highlighted the importance of silver in industry and the potential negative effects if supplies tighten further. He argued that the new export rules and rising prices are “not good” for sectors that depend on the metal.

Elon Musk said, “This is not good. Silver is needed in many industrial processes.” Silver prices have climbed to record highs, near $78.65 per ounce. China’s new export rules will require special government licenses to export silver, starting January 1, 2026. Only certain large companies are expected to meet the license requirements, which may limit exports and reduce global supply.

Silver has been in a structural supply deficit for years, with demand outpacing supply. Inventories of physical silver are falling in major markets, increasing pressure on the supply. The metal is essential for many industries, including solar energy, electric vehicles, electronics, and medical technology.

Elon Musk’s comment on silver prices reflects broader concerns in global markets about the availability and cost of a metal that plays a vital role in modern technology and industrial production. With China’s new rules taking effect soon and supplies already tight, silver prices may continue to be volatile. For now, industry leaders like Musk are watching closely and raising alarms about what these changes could mean for global manufacturing and supply chains.