In China, silver is trading at a premium to the international market price. In the international market, Silver trades above $109, up by over 3% today, after jumping 44% so far in 2026. Over the last 12 months, silver prices have gained over 250%. However, in China, silver premiums have pushed local prices as high as $125 per ounce.
Silver prices are soaring to fresh all-time highs. In India, the silver rate today is Rs 3,35 per 1 gram. The price of silver in India appears to be cheaper by 17% than the price in China.
Here’s how: 1 ounce is equal to approx 28.3 grams. That means, in India, 1 ounce of silver ( 28.3 grams) costs approx Rs 9,984. In China, 1 ounce trades at around $125, which at an exchange rate of Rs 91.6 to a dollar, is equal to approx. Rs 11,450. The difference between the price of one ounce of silver in India and China is approx. Rs 1,969, a differential of about 17%.
The price of silver in India is cheaper compared to China. The demand for silver in China is creating this differential, and there’s a policy decision behind it.
China’s Restrictions on Silver
One of the biggest reasons behind the bull run in silver has been the global supply constraints. On top of that, China has restricted silver exports in the country starting in 2026, requiring businesses to obtain export licenses, with the policy effective until 2027.
When the export restrictions were announced, even Elon Musk expressed concern about supply threats related to China. Musk on X said, “This is not good. Silver is needed in many industrial processes.”
Silver was already experiencing supply shortages, and now, with China restricting silver exports, the volatility in prices is expected to increase.
China accounts for over 65% of the world’s silver supply. China is the world’s leading market for both physical investment and paper trading of silver futures and other similar products, and is the second largest silver fabricator.
Global supply chains will undoubtedly be disrupted if China places export limits. The Silver Institute claims that over the past five years, there has been a constant structural deficit in silver, meaning that demand has continuously outpaced supply.
China’s New Rule
From January 1, 2026, silver exporters in China will need to secure government licenses, a requirement that will only be granted to large, state-sanctioned firms that meet stringent production and financial criteria. This policy is expected to exclude smaller exporters and restrict the availability of Chinese silver in international markets.
It appears the prices of silver in China are showing the way forward for global markets. However, the up move may not last long, and investors need to be cautious of the parabolic rise in silver prices. The corrections in silver price could be equally fast and furious.
In China, the Lunar New Year holiday, beginning on February 17, 2026, lasts approximately a week and leads to the closure of factories and markets in China. This holiday typically prompts buyers to stockpile silver, affecting demand and prices, while sometimes also resulting in reduced market activity. These dynamics can impact global silver markets, particularly given the current low stockpiles and high premiums observed in Shanghai.