Global silver supply dropped by 3% in 2016 to 1.007 billion ounces, Thomson Reuters GFMS survey showed. Silver mine production fell to 885.8 million ounces, marking the lowest level in 14 years. That was largely the result of lower investments in the preceding years.

Russia’s silver output declined by 8% to 46.6 million ounces, sending it one spot below Chile in the ranking of the world’s largest silver producers. Meanwhile, Polymetal rose to the fourth position from fifth.

Despite the fact that silver prices rose by 9% to $17.14 an ounce, secondary refining dropped to the lowest level over the past 24 years to 139.7 million ounces. According to GFMS, there is dehedging in the market for the first time in three years. Silver hedging contracted by 18.4 million ounces.

Total physical demand fell by 11$ in 2016 to 1,027.8 million ounces, on the back of lower demand for jewelry, silverware and retail investment. Holdings in global ETPs increased by 47 million ounces last year compared with an outflow of 17.7 million ounces in 2015.