Silver Open Interest Back Above 110,000

After seemingly left for dead (or the HKMEx) under 90,000 contracts in the wake of the MFGlobal bankruptcy/ client theft, open interest in silver has finally regained the 110,000 level.  Yesterday's Open Interest settled at 110,583 contracts.  Not to get too ahead of ourselves, the 20,000 contract increase in open interest is not all due to new longs standing for delivery, much of it is due to the massive recent increase in the cartel's naked short position, which as we have documented, has nearly doubled just in the past 4 weeks. 
That being said, contrary to several recent articles stating otherwise, silver does remain in a slight backwardation.  Silver's backwardation has however been noticeably easing over the past few months, and only the last 4 traded months, beginning with the July 15 contract remain in backwardation.
With silver threatening to break out past $35 and out of its 9 month downtrend, the physical market is likely to again tighten when traders again feel the rush of a major move up in the shiny metal.

Daily Settlements for Silver Futures (FINAL)Trade Date: 02/22/2012
Month						Settle	Estimated Volume	Prior Day Open Interest
FEB 12						34.239	36	94
MAR 12						34.254	62,556	29,215
APR 12						34.289	114	57
MAY 12						34.328	26,179	36,491
JLY 12						34.382	2,253	8,988
SEP 12						34.421	201	3,852
DEC 12						34.474	2,101	14,165
JAN 13						34.478	-	90
MAR 13						34.486	24	1,573
MAY 13						34.488	-	1,088
JLY 13						34.487	-	3,032
SEP 13						34.471	-	180
DEC 13						34.448	41	8,461
JLY 14						34.366	-	1,040
DEC 14						34.293	30	1,368
JLY 15						34.191	-	227
DEC 15						34.128	20	619
JLY 16						33.984	-	38
DEC 16						33.884	-	5
Total							93,555	110,583