CHART OF THE WEEK: Mexico & Peru Silver Production Big Declines Again In May
According to the data released by Mexico and Peru’s governmental mining data, domestic silver production continued to be depressed in May. Interestingly, the production data just released from Mexico’s INEGI shows that the country’s silver production in May was even less than what they reported for April.
I first wrote about this in my article, World’s Two Largest Silver Producers Mine Supply Cut Drastically In April. The combined silver production loss from Mexico and Peru in April was 432 metric tons or 53% versus the same month last year. Peru accounted for the largest of the decline in April at 237 metric tons (mt) compared to 195 mt for Mexico.
However, Mexico’s silver production in May dropped to 298 mt compared to 301 mt in April. Here is the combined silver production by Mexico and Peru from April 2019 to May 2020:
The net loss of silver production from Mexico and Peru over the last three month period (March to May) is 770 mt, or 32% less than it was during the same period last year. Thus, just these two countries have lost nearly 25 million oz of silver production. I imagine once we factor in losses of silver production from other countries, we could see upwards of 35-40+ million oz decline so far.
But, this is only PHASE ONE of the collapse in global silver production. I stated that as the U.S. and the global economy begin to roll-over in the second half of 2020, and onwards, we are going to see a reduction in base metal demand. With so many people becoming unemployed, the global recession-depression will cause a significant decrease in copper, zinc, and lead demand. Thus, in PHASE TWO, demand for base metals will decline, and with it, the curtailment of copper, zinc, and lead production.
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