Silver miners hit hard by lockdowns, GlobalData says

Since mid-March, the response of governments worldwide to the COVID-19 pandemic has led to disrupted mining activities across the globe.

Thirty-two countries have passed partial or complete lockdown orders, leading to the temporary suspension of activities at over 1,600 mines as of April 3, though that number has since dropped down to 729 as restrictions begin to ease in certain areas, analysts at market research firm GlobalData report.

The exempted mines are, nevertheless, still operating with reduced numbers of workers to minimize the potential spread of the virus, which is causing a slow return for an industry that has already seen production hit by restrictions.

Among the mining activities affected by COVID-19, silver production has been the biggest victim, GlobalData says, with nearly 66% of the world’s annual output still on hold.

Underground mining at Hecla’s Lucky Friday operation in Idaho. Credit: Hecla Mining.

Silver miners First Majestic Silver (TSX: FR; NYSE: AG), Hochschild (LSE: HOC), Hecla Mining (NYSE: HL) and Endeavour Silver (TSX: EDR; NYSE: EXK) have all withdrawn their production guidance for 2020 in the wake of the virus outbreak.

Other metals that are experiencing significant production disruptions include: uranium (32%), zinc (23.8%), platinum (19.5%), nickel (14.6%), diamond (14.4%) and copper (12.7%), according to GlobalData.

Progress has also been halted on 23 mines under construction, including the US$5.3 billion Quellaveco copper mine in Peru, one of the world’s biggest copper mines under development. The project has an annual copper production capacity of up to 180,000 tonnes and is expected to commence operations by 2022.

In Chile, while a lockdown is not in force, Antofagasta (LSE: ANTO) has halted work on its Los Pelambres project and Teck Resources (TSX: TECK.B; NYSE: TECK) has suspended work on the Quebrada Blanca Phase II mine.

At present, lockdowns remain in force in mining jurisdictions like Peru (until May 10), Mexico (May 30), Bolivia (April 30) and Namibia (May 4).

In Quebec, restrictions have been extended to May 4, but the government is allowing mines to reopen from April 15 as essential services, if miners comply with strict safety measures.

Lockdown orders in India, Argentina, Zimbabwe and South Africa have been withdrawn, with mining seen as an essential service.

— This article first appeared in our sister publication, MINING.com.