Industrial demand for Gold, Silver Soars
Source: Commodity Online, Richard Zimmerman (2/3/11)
"With gold and silver, it's unlikely that manufacturers will find substitute metals."
The World Gold Council (WGC) also has research supporting gold demand in the fields of nanotechnology, space, engineering, and architecture.
In their research paper on the future of gold and nanotechnology, the WGC highlights the potential for gold nanoparticles in vaccines, cancer therapies, antimicrobial applications, and pollution control.
Silver also enjoys widespread industrial and commercial uses. The Silver Institute has a long list that includes batteries, mirrors, catalysts, and solar energy. Photography used to be the big demand sector, but obviously digital photography has helped pare that back for the last decade. However, there are still film demands for silver, especially for x-rays. Like gold, silver finds its home in many modern electronics and is used in coatings for DVDs and CDs. Circuit boards and televisions are also home to silver.
Solar energy is an interesting part of silver demand. Silver paste is common in solar cells. Alternative fuel demand is rising, and there is a push to produce something to replace fossil fuels in electricity production. Consumers are savvy to the other choices like wind and solar power. Geo-politics can help push this demand, especially considering the fragile environment around some of the centers for fossil fuel production. Speaking of the environment, silver is also used in water purification.
Higher prices for gold and silver will no doubt affect their use in certain industries. However, these metals' reliability and conductivity have made them the go-to metal for certain components. Thus, it is unlikely that manufacturers will find substitute metals (as with the platinum/palladium in catalytic converters).