Insecurity to Remain an Issue for the Mining Industry in 2023
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Insecurity to Remain an Issue for the Mining Industry in 2023

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Fernando Mares By Fernando Mares | Journalist & Industry Analyst - Tue, 01/10/2023 - 15:38

Despite the federal government’s efforts to combat insecurity, the mining sector has not perceived a reduction in crime rates. Some industry insiders believe that insecurity will remain an issue in 2023, just like it has been throughout the administration of President López Obrador and predecessors. 

Insecurity is one of the biggest problems for companies in Mexico, including mining players. Most of Mexico’s mining activity is carried out in northern states, an area plagued by cartel violence. Recently, the arrest of Ovidio Guzmán, son of druglord Joaquín “El Chapo” Guzmán, caused a series of confrontations between federal forces and cartel members in the State of Sinaloa, resulting in 29 deaths and the closing of businesses and economic activity in key cities. According to the Mexican Geological Survey (SGM), Sinaloa ranked 1st in the production of stone aggregates, 8th in gold and 11th in silver production and is therefore an increasingly important mining state.

In early December 2022, Zacatecas also suffered one of the major violent episodes in recent times. The state, Mexico’s first producer of silver, lead and zinc, suffered from road blockades and violence against the national guard. 

In this context, industry experts do not see the security conditions improving in 2023. In an interview with BNAmericas, Ariel Navarro, Vice President of Exploration, Reyna Silver, said that there is a long way to go to improve, especially in terms of mining security. Nonetheless, he said that the federal and local governments’ recent efforts are positive. “Hopefully, there will be a prompt response, or better [action] than there has been so far,” Navarro added.

In October 2020, the federal government announced the creation of a mining police force through the Federal Protection Service (SPF). The SPF deployed 120 specialized security bodies at the La Herradura mine, property of Fresnillo. While SPF announced more training for units to cover the sector’s needs, the mining industry is not completely satisfied with the service since it represents an extra cost and has not delivered the promised results. On the matter, Humberto Vázquez, President, the Mexican Association of Mining Engineers, Metallurgists and Geologists (AIMMGM) said that the deployment of public forces in mines resulted in armed people stationed at mining projects, an issue AIMMGM opposes. 

The mining sector is worried that Mexican cartels are increasingly moving from the drug trafficking business to other activities like extorsion and thefts, which may affect the integrity and security of their supply chain. On Nov. 17, 2022, the US Treasury Department identified that criminal gangs are involved in illegal mining activities to generate revenue.

Photo by:   Nathy Dog

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