The global silver market is under stress as trade war fears unsettle investors, Bloomberg reports.

Key indicators are showing worrying trends, millions of ounces of silver are shifting between trading hubs, and disruptions could persist for months.

A sharp increase in borrowing rates for the precious metal has become the latest sign of distress amid growing concerns over President Trump’s tariffs. This has triggered substantial shipments of silver into the U.S. to capitalize on premium pricing in New York, potentially causing shortages in London.

Both gold and silver have experienced significant volatility this year as Trump’s actions have disrupted the global trade order. This has boosted demand for safe-haven assets and led to rare pricing distortions between key markets. Spot silver prices have risen roughly 17% this year, making it one of the highest-performing commodities, with futures in New York showing even stronger gains.

On a physical level, concerns about tariffs—particularly against Canada and Mexico, along with broader retaliatory measures set to come into effect next month—have drawn massive volumes of gold and silver from London into U.S. storage facilities. Given their relative values and density, gold is typically transported by air, while silver usually travels longer distances, mainly by sea.

Lease rates—the cost of borrowing silver, typically over short periods—have surged significantly. One-month silver lease rates exceeded 6% this month following an even more dramatic spike in February. This partly reflects concerns about rapidly shrinking inventories in London, where stockpiles hit a record low last month. Moreover, not all remaining inventories are freely available, as many are tied to exchange-traded products.