Mexican Precious Metals Miners Finish 2020 High

The stock value of mining companies has rocketed during 2020 despite the global pandemic that has caused the downfall of stock prices in other industries.

A report by El Economista shows that the stock yield of Industrias Peñoles and Grupo Mexico, both Mexican producers, has risen by 72.98 percent and 58.62 percent, respectively, as the pandemic led investors to flock to precious metals, particularly gold. Industrias Peñoles is Latin American’s leading producer in refined gold and, through its subsidiary, Fresnillo, the largest silver producer in the world. Grupo Mexico, on the other hand, is the fourth largest producer of copper in the region.

Gold prices have climbed dramatically over the past 12 months. According to Goldprice.org, the precious metal has risen from US$1500/oz this time last year to US$1,873/oz today. In August, with COVID-19 cases rising worldwide and no vaccination in sight, prices went above US$2,050/oz. Prices of silver also rose by 44.86 percent to US$25.8298/oz overall this year. Earlier this month, copper hit US$8,028 per metric ton – its highest level since 2013 – as smelters, particularly in China, began cranking up their production levels.

December has been a busy month for Industrias Peñoles. Last week, the company decided to shake-up its leadership, appointing Rafael Rebollar and Mauricio Garcia as CEO and CFO respectively. Despite its strong stock price performance, Industrias Peñoles said its “organizational restructuring” would improve the company’s performance. Just two weeks before that, the company announced plans to reactivate the Naica mine in Mexico’s northern Chihuahua state. As reported by MBN, the mine is renowned for its silver, zinc and lead output, but has not produced since 2015 when it was flooded. Though there have been several similar announcements in the past, Peñoles did say that exploration activities would resume once again very soon.

Positive news about the rollout of COVID-19 vaccines in several countries had dented precious metal prices in November and December. But a mixture of macroeconomic forces, including Trump’s initial refusal to sign the US stimulus bill, as well as news from the UK of a more contagious COVID-19 variant, has seen precious metals close the year strongly. In the last 24 hours, the stimulus bill signed by US President Donald Trump after months of holding off has seen global prices of gold and silver rally.