Mixed production results among silver miners in Mexico

Friday, January 19, 2018

A handful of silver miners in Mexico reported mixed production results for 2017, with two missing guidance while three surpassed expectations.

Output by the country's top 10 silver producers was forecast at 153Moz last year, according to midpoint guidance and BNamericas estimates, up from 142Moz produced in 2016.

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The other five have yet to release 2017 silver output, including the three largest (Industrias PeñolesGoldcorp and Southern Copper).


Vancouver-based companies First Majestic Silver and Endeavour Silver missed original guidance.

First Majestic produced 9.75Moz silver at its six operations, all of which are in Mexico, lower than original guidance of 11.1-12.4Moz and revised guidance of 10.0-10.6Moz.

Among the factors impacting the company's output in 2017 were a series of temporary blockades organized by unionized workers in a dispute over profit-sharing bonuses, including a stoppage at the La Encantada mine (pictured) in June.

Endeavour produced 4.92Moz silver at its trio of Mexican operations in 2017, falling short of the 5.2-5.7Moz originally forecast.

The company lowered its guidance to 4.8-5.2Moz silver following a string of technical challenges at its Guanaceví mine.


Other companies fared better.

Vancouver's Pan American Silver produced 11.9Moz silver at its three Mexican operations, lifted by expansions of its La Colorada and Dolores mines, while output at the ageing Alamo Dorado declined.

La Colorada produced 7.1Moz, ahead of the 6.4-6.9Moz originally guided, with Dolores coming in mid-guidance at 4.2Moz.

Fellow Vancouver-based Fortuna Silver's San José mine in Mexico also exceeded expectations with output of 7.53Moz, up from guidance of 7.1Moz. 

Chicago-based Coeur Mining's Palmarejo mine also surpassed guidance following the successful ramp-up of underground production from the Independencia and Guadalupe deposits. The mine produced 7.24Moz silver, compared to guidance of 6.5-7.0Moz.