Silver prices top $10 an ounce

Silver prices spiked above $10 per ounce in trading Friday – its highest level in 22 years.

Silver futures for May delivery closed at $10.20 per ounce Friday on the New York Mercantile Exchange. On the London Exchange, silver was trading at $10.10 per ounce.

The rally appeared tied to optimism about prospects for silver exchange-traded funds, also known as ETFs. The U.S. Securities and Exchange Commission recently closed a comment period on a proposed silver ETF from Barclays Global Investors.

In essence, ETFs allow investors to purchase commodities without having to pay shipping or storage fees. In this case, Barclays Global owns the silver bullion, and investors buy shares of it through a fund.

A silver ETF is expected to boost demand for physical silver, said Scott Lamb, spokesman for Coeur d’Alene Mines Corp. Though, he notes, “there’s nothing official yet out of the SEC.”

Higher silver prices also mean higher paychecks for Silver Valley miners. At the Galena Mine, owned by Coeur d’Alene Mines, workers receive pay incentives when silver prices top $5.50 per hour. The incentives can mean as much as $2 per hour or more in workers’ paychecks, Lamb said. But according to the current contract, the incentives stop growing at prices around $9 per hour, he said.