76.88 million ounces of registered silver. 575.5 million ounces of open interest. A coverage ratio of 13.4% — below the stress threshold for the sixth consecutive issue. And First Notice Day for the May contract is approaching.In January 2026, 33.45 million ounces of silver were withdrawn from COMEX registered inventory in a single week. That represented roughly 26% of the deliverable pool disappearing in seven days, the kind of event that, if repeated at even half the intensity, would absorb approximately 21% of today’s registered inventory inside a week.
The May 2026 COMEX silver contract delivery cycle is now approaching First Notice Day.
I covered the stagflation data (March at 3.3%, Q4 revised down to +0.5%) in the first article from this issue. This article focuses on something different: the structural mechanics of the COMEX silver market and why the approaching delivery cycle matters more than most commentators are discussing.
What the Numbers Show
The CME Group’s Daily Metal Stocks Report dated April 13, 2026 (reflecting April 10 activity) provides the current picture:
Sources: CME Group — COMEX Daily Metal Stocks Report, , April 13, 2026
Two things in this table warrant attention.
The first is what did not move: registered inventory. Silver traded in a 6.6% range during the two-week window: from $72.26 on April 7 to $77.00 on April 8, then back to $73.58 on April 13. Price swings of that magnitude normally generate registration and de-registration activity, as metal owners reassess whether it makes economic sense to have their bars in the deliverable pool. The fact that registered held essentially flat (gaining just 40,000 ounces) through a 7% single-session ceasefire surge and a 3.5% blockade-driven selloff tells you something about the posture of the entities holding that metal. They did not release inventory at $77. They did not pull it at $73. That behavioral signal (inertia in both directions) is consistent with long-term institutional accumulation rather than short-term price trading.
The second is what did move: eligible inventory drained 1.83 Moz across four separate warehouses simultaneously: Brink’s, Delaware Depository, Loomis International, and Manfra Tordella & Brookes. Understanding why this matters requires the full chain: when a futures contract goes to physical delivery, metal is drawn from registered inventory; operators replenish registered by converting eligible metal through a warrant process; if eligible is itself draining without offsetting inflows, the buffer available to replenish registered when it is needed starts to thin. The drain is slow enough in isolation not to be alarming. The direction, persistently outward across multiple vaults, is the signal.
The Coverage Ratio and What It Means
Against 76.88 Moz of registered silver sits approximately 575.5 Moz of open interest on COMEX silver contracts. That is a coverage ratio of 13.4%, representing the share of paper contracts that could theoretically be satisfied with immediately deliverable physical metal.
The 15% threshold is where COMEX analysts define stress territory. The current ratio has been below that threshold for six consecutive issues. It has not improved once.
A leverage ratio of 7.5:1 (575.5 Moz paper divided by 76.88 Moz registered) sounds alarming stated baldly, but context matters. COMEX normally operates with leverage in the 5–8:1 range. The system functions because the vast majority of futures contracts (historically 97–99%) roll forward or settle in cash rather than taking physical delivery. Nobody actually demands the metal.
Until they do.
In January 2026, the delivery rate spiked toward 5–10% of contracts. In a single week, 33.45 Moz was withdrawn from registered inventory, representing 26% of the deliverable pool in seven days. Each 1% increase in the delivery rate on the May contract above historical norms would require an additional 5–6 Moz of registered metal. At current registered levels of 76.88 Moz, a repeat of January’s intensity — even at half the magnitude — would draw down approximately 21% of registered inventory in a week.
The May delivery cycle does not need to replicate January to be consequential. It simply needs to run at a slightly elevated delivery rate, sustained over several days, into a registered pool that has not grown.
Why This Matters Beyond the Near Term
The COMEX situation connects to a broader structural reality that “Silver Rising” identified as Catalyst #2: COMEX Inventory Depletion Creating Delivery Crisis. The mechanism the book described is not a theoretical risk: a paper market that has grown while the physical inventory backing it has shrunk. It is the current operating condition of the COMEX silver market, measurable in the daily warehouse report.
Catalyst #48: 28 Paper Ounces Per Physical Ounce Available captures the leverage dimension. The catalyst name uses a ratio from when the book was written; the current 7.5:1 ratio reflects improvement from those extremes, but the structural dynamic (far more paper than deliverable physical) remains intact and is the standing condition entering the May cycle.
What makes the current moment particularly pointed is the combination of factors arriving simultaneously. The coverage ratio is at 13.4%. The eligible pool is draining. The January withdrawal demonstrated that the system can experience acute stress rapidly. And the May delivery cycle opens against this backdrop while geopolitical risk (Hormuz blockade, though ceasefire talks are progressing with Brent retreating to approximately $87-88 on deal optimism as of April 17) means the physical supply picture remains in flux.
The World Silver Survey 2026 confirmed a projected sixth consecutive annual deficit of 46.3 Moz for 2026 (2025 actual: 40.3 Moz), with approximately 762 Moz drawn from above-ground stocks since 2021. That provides the structural backdrop. Deficits do not create delivery events directly. But they mean the above-ground inventory available to backstop a stressed COMEX has been declining for five consecutive years.
The Outlook
Silver at $79.60 (April 17) is approximately 34.6% below the $121.67 all-time high of January 29. The correction is real, and short-term volatility will continue while the Hormuz situation remains unresolved and rate expectations stay elevated.
What has not corrected is the underlying structure. The COMEX coverage ratio did not improve through the correction. The eligible pool did not refill. The paper leverage ratio did not compress. These are not price signals — they are physical infrastructure signals, and they move more slowly and more consequentially than spot price.
