**Key Takeaways**
– India’s review of its CEPA with the UAE is creating uncertainty around silver import volumes.
– Silver imports from the UAE surged 5,853% year-over-year, driven by tariff concessions under the trade deal.
– The review questions the long-term benefits of the agreement, potentially impacting global silver prices.
– First Majestic Silver’s merger with Gatos Silver will boost production and strengthen the company’s global standing.
**India’s CEPA Review with UAE Sparks Uncertainty in Silver Market**
India’s review of its Comprehensive Economic Partnership Agreement (CEPA) with the UAE is also weighing on silver. The review focuses on tariff concessions and import regulations, creating uncertainty around silver import volumes. Despite broader positive market sentiment, silver has struggled to break out of its current trading range.
India’s silver imports from the UAE surged 5,853% year-over-year, totaling $1.74 billion in FY24, compared to just $29 million the previous year. The massive increase is linked to tariff concessions under CEPA, a trade deal between India and the UAE implemented in May 2022. Although the deal was initially seen as a step toward free trade, India’s recent review questions the long-term benefits, particularly regarding the surge in precious metal imports. The uncertainty surrounding the trade agreement and its potential revisions could influence future silver imports, thereby impacting global silver prices. However, the true effect will depend on how India renegotiates terms with the UAE.
**First Majestic Silver’s Merger with Gatos Silver to Boost Production**
In corporate news, First Majestic Silver has announced a merger with Gatos Silver, valuing the latter at $13.49 per share. The merger will consolidate three major silver mining districts, increasing First Majestic’s silver-equivalent production to 30-32 million ounces annually, including 15-16 million ounces of silver. With projected all-in sustaining costs between $18.00 and $20.00 per ounce, the merger is expected to strengthen First Majestic’s global standing. However, increased supply could put downward pressure on silver prices, contingent on demand trends and production costs.