National Defense Requirements for a Silver Stockpile

The United States stockpiles 93 commodities having strategic and critical importance to national defense. To determine stockpile policy and goals for these commodities, the Federal Preparedness Agency (FPA) of the General Services Administration (GSA) uses a mathematical model to estimate what the requirements of the Nation's wartime economy will be. The FPA modifies the model based on inputs from the Departments of Commerce, Defense, State, and the Interior. Inputs are estimates based on data showing what past experience has been and expert judgment as to what a future situation could be in time of war. In 1976 the FPA determined that the Nation's silver stockpile of 139.5 million troy ounces exceeds national defense requirements. GSA has requested congressional approval for the phased sale of this inventory.

Analysis of the silver stockpile requirement was primarily on the basis of data used to determine the 1976 stockpile goals. The computations used at the Bureau of Mines to formulate silver import projections have varied with the commodity experts performing the estimates. These variances have resulted in large differences in the figures used by FPA to formulate the 1976 and 1979 silver stockpile goals. Although the inconsistency substantially lowered silver supply projections, current information indicates that the silver supply exceeds the projected wartime requirements. New stockpile goals are presently under review and official figures are expected to be published in 1979.