Supreme Court Stalls on Mining Law’s Constitutionality
By Alejandro Ehrenberg | Journalist and Industry Analyst -
Thu, 05/21/2020 - 13:50
The Week in Mining calls attention to developments in Mexico’s mining industry, where companies are getting ready to restart operations after several weeks of shutdown due to COVID-19. Furthermore, First Majestic initiated the process to take Mexico to international arbitration over a tax dispute. Also, Mexico’s Supreme Court stalls on a decision that involves the Mining Law’s constitutionality.
Mexico
Mexico’s miners are getting ready to resume operations in June. Health authorities will inspect companies’ sanitary protocols before deciding whether it is safe to go back to work.
Minister Javier Laynez of Mexico’s Supreme Court decided to withdraw his project to rule against an appeal filed by indigenous communities in Puebla. The appeal asked the Supreme Court to revise the constitutionality of Mexico’s Mining Law.
Mexican miner Industrias Peñoles will suspend operations at its Francisco I. Madero zinc unit in Zacatecas indefinitely due to difficult mining conditions and low metal prices. Peñoles said it has started dismissing unionized workers at Francisco I. Madero. It will attempt to relocate workers to other mining units.
First Majestic Silver has taken steps to serve Mexico with a notice of intent to submit a claim under the provisions of Chapter 11 of NAFTA. As noted on First Majestic’s website, “the service of this notice initiates a 90-day process for the Mexican government to enter into good faith and amicable negotiations with the company to resolve the current dispute between the company and the Mexican government.” The dispute is related to the way Mexico taxes First Majestic.
Metals
The World Gold Council (WGC) presented a report that evaluates the behavior of gold given four hypothetical post-COVID-19 scenarios provided by Oxford Economics:
- Swift recovery.
- US corporate crisis.
- Emerging markets downturn.
- Deep recession.
WGC analysis shows that higher risk and uncertainty combined with lower opportunity cost will likely be supportive of gold investment demand in 2020.
FX Empire notes that silver is testsing the US$17.50/oz level, continuing its upside move boosted by a general rally in the precious metal segment and a weaker US dollar.
In his Reuters column, Andy Home says that China is short of copper scrap. “Beijing had intended to ban all copper scrap imports at the end of this year in the same way it has already locked out other forms of "foreign garbage" such as used plastic. The government has since relented under pressure from its own copper sector, which was panicking about the loss of a major component of China’s copper supply chain. Imports of higher-grade copper scrap have been reclassified from “waste” to “resource.”
You May Like
Most popular
