The Silver Institute-Silver News

Silver Production Rises in Mexico and Latin America, Some Countries Hitting Ten-Year Highs

Silver mining in Latin America and Mexico is undergoing a mini-boom with some countries experiencing the highest production levels in ten years.

Mexico, the world's largest silver producer, increased its output in 1945 to 74.73 million ounces after falling annually since 1990 when it had produced 78.86 million ounces, according to the World Silver Survey 1996, published by The Silver Institute. Production in 1995 was almost 5 percent higher than 1994 levels of 71.2 million ounces.

Peru, which hit a ten-year high in 1991 with 67.08 million ounces and also experienced falling production since then, reversed its downward trend in 1995 with 61.35 million ounces of silver. Output in 1995 was almost 10 percent higher than the 1994 production of 56.0 million ounces.

Chile's production hit its highest level in ten years with 1995 production of 33.49 million ounces, and Bolivia produced 11.94 million ounces, also a ten-year high.

All of Latin America, including Mexico, produced 185.11million ounces of silver in 1995, the highest level in the past ten years, according to the World Silver Survey 1996.

There are many reasons for the marked increase in production in all countries. Rising silver prices over the past two years have spurred production. In addition, new base metal mines producing lead, zinc and silver have opened during the past two years. Increased silver output is also the result of increased gold mining activity from mines where silver is a by-product.

In Mexico, the devaluation of the peso allowed miners to produce silver with cheap national currency and sell it overseas in dollars. Another factor was mining reform which encouraged foreign investors to set up their operations but also allowed domestic producers to find suitable mining partners. The 1993 mining reform package also cut much of the red tape involved in mining operations.

In Peru, increased silver production is being pegged to improvements in the country's economic and political situation. With a growing gross domestic product (GDP). Peruvian miners are willing to commit new funds to upgrade current facilities and develop new ones.