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BREAKING NEWS: Peru Silver Mine Supply Collapsed In April

BREAKING NEWS: Peru Silver Mine Supply Collapsed In April

With the data now finally out, Peru’s silver mine production collapsed in April.  Due to the shutdown of a large portion of Peru’s mining industry, as a result of the global contagion, the impact on the world’s second-largest silver supply was enormous.  While I had mentioned in previous articles that I expected to see silver production from Mexico and Peru to decline significantly, I’m amazed actually to see the real numbers.

Over the past several months, I have checked the Peru Ministry of Mines website for updates on the domestic mine supply figures.  However, they have not updated their monthly production data since December 2019.  I tried writing the Peru Ministry of Mines website to find out why they haven’t been updating their figures, but I received no reply.

I decided to do a bit more digging and found a newly released April 2020 Mining Update in response to the global contagion.  This new Mining Bulletin published Peru’s mine production data for January to April 2020.  According to the recently released data, Peru’s silver mine supply in April fell to 85 metric tons (mt) versus 322 mt during the same month in 2019:

Peru’s silver mine supply collapsed by 74% in just a few months.  If we convert to troy ounces, the year-over-year change was a decline from 10.3 million oz (Moz) to 2.7 Moz.  Thus, the world’s second-largest silver mine supply fell 7.6 Moz in April.  Now, if we look at Peru’s monthly mine supply over the past year, we can see that silver production started to decline in March:

As the Peruvian government started implementing mine closures in the middle of March, silver production fell by nearly 100 metric tons compared to February.

So, if we compare the change in the first four months of 2020 versus the same period last year, here is the result:

…click on the above link to read the rest of the article…

PERU EXTENDS LOCK-DOWN ALONG WITH MEXICO: An Estimated 40% Of Global Silver Mine Supply Now Offline

PERU EXTENDS LOCK-DOWN ALONG WITH MEXICO: An Estimated 40% Of Global Silver Mine Supply Now Offline

Now that the Peruvian Government announced an extension of the country’s state of emergency until April 26th, the world’s first and second-largest silver producers have taken 40% of global silver mine supply offline for a month.  Actually, Peru first announced its national quarantine on March 15th.  So, the country’s mines will be shut down for more than a month when the state of emergency is projected to end on April 26th.  But, will it?

According to the Reuters article, Peru’s Vizcarra extends state of emergency to April 26th; thecountry will remain on lockdown for an additional two weeks:

Including Mexico’s state of emergency issued on April 2nd to last until the end of the month, the total estimated silver production lost from these two countries could be 28 million oz (Moz).  That is 40% of global mine supply. But, what if additional mines have been shut down in other countries?

As I stated in previous articles and my Youtube video updates, we could see between 100-150 Moz of global silver mine supply lost this year.  However, if we just consider the estimated 28 Moz of silver production lost from Mexico and Peru, that would equal 28,000 of the 1,000 oz wholesale silver bars.

With the continued surge in demand for silver bullion pushing availability of products back weeks and for months, it has also impacted the 1,000 oz wholesale silver bar market. How will the reduction of 28,000 wholesale 1,000 oz silver bars impact the market in the next few months??  Good question.

…click on the above link to read the rest of the article…

GLOBAL SILVER SUPPLY COLLAPSE ON ITS WAY: Mexico mining suspension to hit silver supply

GLOBAL SILVER SUPPLY COLLAPSE ON ITS WAY: Mexico mining suspension to hit silver supply

Due to Mexico’s Ministry of Health issuing an Executive Order for the immediate suspension of non-essential activities until April 30th, the mining industry in the country has now come to an abrupt halt.  The mining industry was hoping for an exemption to the Executive Order, but was not granted one.  So, companies are now suspending production and putting their mines on care and maintenance.

According to the article on the Mining Journal website, Mexico mining suspension to hit silver supply:

Under the government decree, non-essential activities are to be suspended immediately until April 30.

The decision is expected to have a significant impact on the supply of silver at a time when demand for silver coins is high. Mexico is the world’s largest silver producer at some 23% of world production and produced more than 200 million ounces in 2019, up from 196.6 million ounces in 2018.

With Mexico shutting down its mines, including the continued closure of Peru’s Mining Industry announced on March 15th, nearly 40% of global silver production is offline. Peru’s government stated that the national quarantine would last 15 days.  However, we have passed that point, and there is no announcement of a return back to work.

Here are the top ten silver producing countries in the world in 2018:

In 2018, Mexico and Peru accounted for 342 million oz of silver production.  If mines in Mexico and Peru remain shut down for a month, that will cut silver production by 28 million oz.  So, each month that Mexico and Peru are offline, would reduce silver mine supply by 28 million oz.  However, I believe we are going to see more countries shut down their mines for an extended period as the global contagion continues to spread.

…click on the above link to read the rest of the article…

SILVER PRICE UPDATE: Including End Of A Silver Mining Era

SILVER PRICE UPDATE: Including End Of A Silver Mining Era

Since my last video update, the silver price has consolidated to a lower level.  While I wasn’t surprised to see silver continue to correct, I do believe its only temporary before it begins a new leg higher.  And, if we look at the COT Report for silver, there are some positive signs going forward.

But, before I provide a preview on my newest video update, Silver Price Update & End Of A Silver Mining Era, I wanted to clarify my position on “technical analysis.”  There seems to be a large group of precious metals investors that have a negative KNEE-JERK reaction when I post some charts on technical analysis, stated several reasons why it’s a waste of time to do it when the market is rigged or controlled by the bullion banks (JP Morgan), the Fed and central banks.

While new and long-term followers are free to post any comments they desire about the pros or cons of technical analysis, my reason for doing so is to show what TRADERS ARE LOOKING AT and what they expect going forward. Traders, hedge funds and large institutions all study and follow technical analysis.  Right now, they are the leading drivers of the silver price.

However, technical analysis patterns will not provide the ultimate FUNDAMENTAL VALUE for silver when the Fed and Central Banks lose control of the Fiat Monetary system and economy.  Yes… at that point, technical analysis won’t matter.  BUT, we aren’t there yet.

So, instead of precious metals investors becoming frustrated because they believe the silver price should only go IN ONE DIRECTION… UP, I am just showing how silver trades in the current system.  Thus, if it falls back down to a certain key technical level before moving higher, you CAN TAKE IT OR LEAVE IT. 

 …click on the above link to read the rest of the article…

MORE TROUBLE IN MEXICO: Second Largest Silver Mine Suspended Operations

MORE TROUBLE IN MEXICO: Second Largest Silver Mine Suspended Operations

In just a little more than a week after the mighty Newmont-Goldcorp merger was finalized, the company suspended operations of its largest gold-silver mine in Mexico.  The Penasquito Mine, which produced more than a 500,000 ounces of gold and 25 million ounces of silver in a single year, has been dealing with a blockade of its operations since March 27th.

The blockade was started due to issues with the local community in regards to water supply concerns and problems with a trucking contractor.  However, the protests by the local community over water rights have been going on ever since the Penasquito Mine started operations in 2010.

According to the article, Goldcorp using excessive water at Peñasquito mine – critics, research by McGill Research Group, reported that the Penasquito Mine was using three times the amount of water than it originally agreed upon.  Furthermore, the large open-pit gold-silver mine, located in the state of Zacatecas, was also consuming three times the amount of water supplied to the entire City of Zacatecas (population 129,000).

To get an idea the amount of water being consumed by the Penasquito Mine, I looked at the data from Goldcorp’s most recent Sustainability Report. In 2017, the Penasquito Mine withdrew a staggering 7.9 billion gallons of water to supply its operations for the year.  Of that total amount, 93% came from groundwater. That is one hell of a lot of water.

It will be interesting to see how long it takes for the suspension to end.  However, with the election of the new President AMLO of Mexico, Andrés Manuel López Obrador, large foreign mining companies in Mexico may find it increasingly challenging to GET THEIR WAY as they have in the past with the help of pro-mining leaders.

Regardless, the Penasquito Mine produced the second highest amount of silver in Mexico last year:

 …click on the above link to read the rest of the article…

CHILE, WORLD’S FOURTH LARGEST SILVER PRODUCER: Mine Supply Down 20%

CHILE, WORLD’S FOURTH LARGEST SILVER PRODUCER: Mine Supply Down 20%

Silver mine supply from the world’s fourth-largest silver producer fell significantly at the beginning of 2018.  According to Chile’s Ministry of Mines, domestic silver production in January declined 20% versus the same month last year.  Chile’s silver production has been falling considerably since its recent peak in 2014.

In just three years, Chile’s domestic silver mine supply fell 10 million oz (Moz) from 50.1 Moz in 2014 to 40.4 Moz last year.  Interestingly, Chile’s silver production is down 20% since 2014 while the country’s copper mine supply is only down 5%.  Because most of Chile’s silver supply comes as a by-product of copper mining, it’s surprising to see such a significant decline in their silver production.

If we look at three of the top four silver producers in the world, Mexico’s silver mine supply in January increased 7% while Peru declined 6%:

According to the official data, Mexico’ silver production increased 29 metric tons (mt), Peru fell 20 mt and Chile dropped by nearly 21 mt.  Thus, overall silver mine supply from these top three producers fell 13 mt in January versus the same month last year.  Even though Mexico will likely experience an increase in silver mine supply in 2018, declining production from other leading countries may curtail overall world supply.

If we look at total silver production from these three countries, the peak took place in 2015 at 373 million oz:

In just two years, the combined silver output from Mexico, Peru, and Chile is down 21 Moz.  Now, what’s even more interesting is the growing disparity in production figures released by the official governments and those collected by Thomson Reuters GFMS and published in the World Silver Surveys.

…click on the above link to read the rest of the article…

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