Indian retail investors got a sharp reminder of how volatile commodities can be on December 29, as silver exchange-traded funds swung wildly through the trading session. Prices reacted to two global triggers over the weekend — China’s move to restrict silver exports and higher trading margins announced by CME Group.
The result was one of the sharpest intraday swings seen in silver ETFs in 2025.
Soon after markets opened at 9:15 am, the Nippon Silver ETF, India’s largest silver ETF by assets under management, jumped nearly 11% to a fresh record of ₹243.29 a gramme, compared with its previous close of ₹219.85.
But the rally did not last. By around 12:30 pm, the fund slipped sharply, falling nearly 19% to ₹196.30. By 1:30 pm, it was trading slightly lower at ₹218.68, according to data from the National Stock Exchange of India Ltd.
Similar moves were seen across other silver ETFs. Kotak Silver ETF swung nearly 24% during the session, moving between ₹244.70 and ₹185.57 per gramme before stabilising around ₹219.46. Tata Silver ETF showed an even wider swing of about 29%, trading between ₹25.10 and ₹17.77 per one-tenth gramme, before settling near ₹22.25.
Market participants said the initial surge reflected Indian ETFs catching up with international prices, as global silver markets trade much later into the night compared with Indian exchanges.
On December 26, silver on Comex jumped as much as 17% to $84 an ounce before closing at $79.27, after Indian markets had already shut at 3:30 pm. By the time Indian ETFs were trading on December 29, Comex silver had cooled off, trading lower around $75.82 an ounce by early afternoon.
Adding to the volatility was CME’s decision to raise the margin required to trade silver futures. The exchange increased margins to $25,000 per contract, effective December 29, from $20,000 earlier in the month.
Higher margins typically force traders to bring in more capital or reduce positions, which can amplify price swings in the short term.
Underlying the sharp moves are growing concerns about global silver supply. China, the world’s second-largest producer of silver, is set to impose export restrictions from January 1. Analysts believe this could further tighten availability in global markets.
Global demand for silver is estimated at around 1.2 billion ounces a year. Over the past five years, supply has already fallen short by about 200 million ounces annually, creating a cumulative gap of nearly 1 billion ounces. With China’s export controls, global supply could fall by around 13% to about 870 million ounces, according to market estimates.
The issue also drew attention on social media. On December 27, Elon Musk responded to a post on China’s export restrictions by saying on X that silver is critical for many industrial processes.
Silver is widely used in electric vehicles, solar panels and semiconductors, which keeps long-term demand intact. At the same time, the sharp intraday moves seen on December 29 highlight how quickly sentiment can change when global policy decisions and trading rules shift.
India’s largest silver ETF, Nippon Silver ETF, remains up over 150% so far in 2025, tracking the international rally. On December 29 alone, trading value in the fund surged to a record ₹6,226.71 crore, driven largely by volatility rather than fresh long-term buying.
Analysts caution that while supply concerns remain, such sharp swings underline the risks for new investors entering the market at elevated levels.