Mexican silver mining is down but not out

Subject

Falling silver production in Mexico.

Significance

Despite positive results from companies operating in the country, official data released in January by the National Institute of Statistics and Geography (INEGI) shows that silver output in Mexico -- the world's largest producer -- has dropped over the past two years. Like much of the rest of the world, the country's mining industry has seen few new mines open up since metal prices began falling in early 2014. Companies that were already operating there, in turn, have placed emphasis on cost-reduction and improving capital management.

Impacts

• Falling silver prices could result in a lack of projects advancing to production in the coming years.
• Investors see Mexico as one of the few solid markets left, but their enthusiasm may be overshadowed by broader fears about emerging markets.
• Issues such as cartel violence and indigenous rights are unlikely to deter investors but may involve extra expenses for mining companies.