Global Silver Mining Industry Productivity Falls To The Lowest In History

After the Primary Silver Mining Industry enjoyed a brief increase in productivity over the past two years, it fell to the lowest ever in 2016.  The reason the primary silver mining industry’saverage yield increased in 2014 was due to the addition of Tahoe Resources high-grade Escobal Silver Mine.

Tahoe’s Escobal Silver Mine’s average yield in 2014 was an astonishing 16.3 ounce per ton (oz/t).  Not only did Escobal Mine enjoy one the highest silver yields in the world, it produced over 20 million oz (Moz) in 2014.  Thus, the addition of Tahoe to the Top Silver Miners pushed their average yield to 7.8 oz/t in 2014 versus 7.6 oz/t in 2013:

This Chart #11 was one of 48 Silver Charts in my THE SILVER CHART REPORT.  If you have not yet looked at this report, I highly recommend it for those who are interested in the silver market and industry.  THE SILVER CHART REPORT  provides information and analysis on the silver market and industry not found found in any other single report on the internet.

The Silver Chart Report is a a collection of my top silver charts from articles published over the past six years, and includes in-depth, never-before-seen charts and content that indicate that silver is on the rise. There are 48 charts in the report, broken down in five sections:

  • Silver Production
  • Mining & Falling Ore Grades
  • Official Silver Coin Sales
  • Silver Price
  • The Silver Market

The charts in these five sections give the investor a broad background of the silver industry and market. Silver will likely be one of the most sought-after physical assets in the future. Why? There are several factors that will impact its price (value) in the future, and they are explained thoroughly in The Silver Chart Report.

Now, what is very interesting about adding Tahoe’s Escobal super high-grade mine to the group, it didn’t move the average yield up that much…. only 0.2 0z/t to 7.8 oz/t.

I didn’t update this chart for 2015.  However, I have now added the data for 2015 and 2016.  As we can see in the updated chart below, the group’s silver production has increased over the past two years from 138 Moz in 2014 to 158 Moz last year.  The majority of this increase was due to the ramp up of Fresnillo LLC’s Saucito Mine:

Even though the top 7 Primary Silver Mining Companies increased their production to 158 Moz in 2016, the amount of ore they processed also reached a record high.  For example, these silver mining companies processed a record 21.3 million tons of ore in 2016 compared to 19.9 million tons in 2015.  Furthermore, the top silver miners only processed 9.4 million tons of ore in 2005 to produce 123 Moz of silver… yielding 13 oz/t.

The falling average yield in the silver mining industry seems to be overlooked by the majority of analysts.  As we can see in the chart above, the primary silver miner’s average yield has fallen from 13 oz/t in 2005 to 7.4 oz/t in 2016.  This is a 43% decline in just 12 years. 

Lastly, Tahoe Escobal Mine’s average silver yield will continue to fall over the next ten years.  Thus, the global silver mining industry will continue to process more ore to produce the same or less silver in the future.  While the cost of energy has declined over the past few years, falling ore grades will continue to put pressure on the silver mining industry going forward.

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44 Comments on "Global Silver Mining Industry Productivity Falls To The Lowest In History"

  1. If PMs fail to break up in the coming days, they willl probably go down considerably. Gold may go down to $900 and silver to $10-11. New probable dips are close to 100 year suport line for G&S.

    • pablo,

      Very nice first comment on this site and price forecast. You get a GOLD STAR for your excellent trading skill.

      While anything is possible for short-term trading, it is becoming increasingly MEANINGLESS to focus on this. The U.S. and world markets are heading for a crash of epic proportions. So, it is more WISE to focus on owning physical metal, rather than worrying about how the paper price will move in the short term.

      steve

    • robert sinclair | April 25, 2017 at 12:29 am | Reply

      How do you figure that?

      • Every market analyst sits on the fence until the clear breakout offering two possibilities. So the prices will go up or down, that is their expertise. If there is no breakout, the last year rally should be regarded as bear market one. The continuation of falling channel means that the price goes down. On the other hand, falling channel is a continuation pattern which means that after the next dip a long-term bull market develops. Isn’t it easy to be market analyst?

        • Pablo, prices are irrelevant when you can create currency out of thin air. Markets are artificial now, its hot air. After a few years you won’t be able to buy anything with hot air. We’re in very dangerous waters now.

          • “prices are irrelevant when you can create currency out of thin air.”

            not quite. prices are irrelevant to those who can create currency out of thin air – prices remain relevant to those who cannot create currency out of thin air.

            as was always intended and planned, from the beginning.

          • Yes gman. With the abyss in sight we go full throttle.

          • “With the abyss in sight we go full throttle.”

            it’s not our hand on the throttle.

  2. These graphs are only about the primary silver mines and “most” silver is a by- product of mining other materials. How significant is this if you include the silver productivity of non- primary silver mines….just wondering. You could also look at your second graph and it appears that over the last 4 years silver productivity has flat-lined.

    • Jim,

      Yes, it is true that the decline of yield is on the Primary Silver Mining Industry. However, Primary Silver Mining still provides a good portion of overall silver production 30%. Without this primary silver supply, the Global Silver Market would be in serious trouble.

      Furthermore, the coming crash of the Global Markets will destroy demand for base metals. Thus, by product silver production will really fall as base metal demand drops precipitously.

      Regardless, while the average yield has leveled off over the past four years, this was due to the addition of Tahoe’s high-grade Escobal Mine. Average yields at Escobal are forecasted to decline significantly over the next decade. Plus with falling yields at other primary silver mines, the decline in Group’s average yield will pick up over the next 5 years.

      steve

  3. All the more reason to green-light that Pebble Mine in Alaska? Yes, it’s going to be energy-expensive to initiate, but there have been comparable cost outlays executed on other difficult mines, and they’ve ultimately been profitable. The 70+ million oz gold and 344 million oz. silver, (M&I) and another 30+ million oz. gold and 170 million ounces silver on the inferred side may well make it economic if/when Silver is reaching $50+/oz and gold is breaking $1800 again in the coming years. What are your thoughts on these kind of mega-mines being worth the energy expense to power and produce for the market? I think that being located within the technical United States will make it a far easier sell overall, with the hard push for protectionism in this stage of empire collapse…

    • MatthewD,

      I believe these MEGA-MINES will not become commercial in the future due to the disintegration of the U.S. and Global Oil Industry within in the next 5-10 years. I am not saying that NONE of these MEGA-MINES will ever make it to commercial production, but chances will become increasingly slim as the world heads over the ENERGY CLIFF.

      steve

    • ManoftheNorth | April 26, 2017 at 2:38 pm | Reply

      The Pebble Mine will probably never happen. Because it is in the Bristol Bay watershed it is seen as a major risk to a very valuable salmon fishery that most Alaskans see as of far greater value in the long run than the Pebble project. As a gold miner and fisherman I am sympathetic to both points of view but as an Alaskan I can tell you that there is very little support for the Pebble Mine being developed. Anglo American came to the same conclusion (I suppose) when they walked away from $541,000,000 in expenditures giving up their 50% interest in the project back in 2013.
      But what do I know, I wash rocks for a living 😉

  4. Great job Steve !

  5. Trump will lower the taxes.Another problem for PM’s.My chart(HUI) points in direction
    180.So they smashed agian the mood for PM.What will stop this?Maybe a 30% lower output at silver?

  6. Given that gold miners have a hard time staying in business with 1250$/oz prices and 1-3 grams per ton ore, how in the world can a primary silver producer be anywhere close to profitable at 18$/oz with silver ore grades around 8-10 grams ???

    • Diogenes Shrugged | April 25, 2017 at 10:22 am | Reply

      CHX13: Silver grades of 8-10 ounces, not grams.

      We keep mixing up systems of measurement here. In the U.S., it’s typically Troy ounces per short ton, or oz/ton. Outside the U.S., the metric system uses grams per thousand kilograms, or g/tonne. A ton is 2,000 pounds. A tonne is about 2,205 pounds. At $1,250 per ounce, it’s pretty important to keep your units straight.

      The ordinates on the graphs should be labeled oz/ton. The gold mining industry NEVER mixes the systems of measurement to arrive at something so confusing as oz/tonne.

      By the way, grams per thousand kilograms is the same as parts per million. It’s a real shame the U.S. isn’t metric.

    • “how in the world can a primary silver producer be anywhere close to profitable at 18$/oz with silver ore grades around 8-10 grams ???”

      by using “dark pools”.

      • gman,

        Has nothing to do with “DARK POOLS”. CHX13 misunderstood oz/t for gram/t. The primary silver miners are making money at $17-$18 an ounce. So, it is possible to make money producing silver at this price.

        NO BIG DEAL.

        steve

        • DisappearingCulture | April 26, 2017 at 8:33 am | Reply

          Wait Steve! There has to be a conspiracy or dark side doesn’t there lol

          • DisapprearingCulture,

            Yes… after my daily Conspiracy Theory briefings with Bix Weir, we concluded that at some point, the Fed-Central Banks and Aliens are going to roll out a new financial system. Not only will we bring out the 2 million tons of gold hidden in Nazi vaults as well as many other locations such as in Hawaii, we are going to be able to use new FREE ENERGY TECHNOLOGY.

            At that point, everything will be FREE, so costs won’t matter anymore. Thus, my website will become irrelevant. Which means, I can go back to my home on Mars and start doing some real productive work.

            steve

  7. Thanks Steve!
    Jim

  8. Every week for years you put out graphs showing there is a collapse coming but every week things just keep on going. Just how much longer are we supposed to believe a collapse is comming?

    • Stuart,

      Yes… I write articles about the coming collapse. Let me explain it this way, if you don’t mind.

      Back in 2005, 2006 and 2007, Peter Schiff was a guest on CNBC and Fox Business. He continued to call for the collapse of the housing market and the banking industry. Every time he came on the show, he was the OUTSIDER. Actually, many times he was the laughing stock.

      However, the collapse of the Housing Market and Banking System did take place in 2008-2009. We must remember, Lehman Brothers went belly-up and disappeared after being an investment bank since the American civil war in the 1860’s.

      Thus, Peter Schiff sounded like a broken record or as they say, CHICKEN LITTLE every time he made the same forecast. But, the forecast did finally take place. I remember, only ONE host on these financial networks gave him some credit… the rest just didn’t even mention it.

      This time around… the COLLAPSE will be much worse. What Peter Schiff was talking about back then was a PICNIC for what is coming.

      Unfortunately, the Fed and Central Banks have leveraged the system so great, the COLLAPSE will be one we never pull out of. Didn’t you read the article a few days ago on Zerohedge that showed the Central Banks bought $1.1 trillion worth of Stocks and Bonds in the first four months of 2017???? This is insanity.

      Lastly…. the thing that people have forgotten about is PATIENCE. We are too IMPATIENT. That being said, I am not looking forward to this collapse. When it comes, it won’t be fun at all. I rather wish I was wrong about this.

      steve

      • Steve, I assume it was similar to what we can see here http://video.cnbc.com/gallery/?video=3000612918&play=1 .

        • DisappearingCulture | April 26, 2017 at 8:48 am | Reply

          Somewhat, but Kark Faber talks about the markets just based on financial facts or fundamentals. He doesn’t focus on energy fundamentals.

      • “Lastly…. the thing that people have forgotten about is PATIENCE.”

        getting old while waiting a decade or three for “the end of the world” does make one impatient, sure.

        heh. was reading the other day about the presidential campaign involving andrew jackson. his opponents said that electing jackson would guarantee the “end times” and the destruction of the world ….

      • Thankyou for the reply.
        Yes its true that Peter Schiff was laughed at for a couple of years before the crisis started in 2008.

        However he has made many predictions since which have been plainly wrong.
        He predicted there would be hyper-inflation due to QE.
        He predicted the USD would collapse.
        He predicted the bond market would collapse.
        He predicted the US would default.
        He predicted the US could never raise interest rates.
        etc.
        So although he was right in 2008 he has been wrong ever since.

        Respectively Stuart

    • DisappearingCulture | April 26, 2017 at 9:08 am | Reply

      “Every week for years you put out graphs showing there is a collapse coming but every week things just keep on going. Just how much longer are we supposed to believe a collapse is comming?”

      Listen and learn. https://www.youtube.com/watch?v=-2ANSsMaq08

      • “In this video, Mike explains that gold has been manipulated for so long, it could catapult up in price when the wheels come of the U.S. Dollar-backed economy.”

        (shakes head) no, not “catapult up in price”, rather “dollar loses utility”. total wishful thinking by this guy, because if the dollar-backed economy fails then there will be no utility for gold either, because there will be no economy.

        • DisappearingCulture | April 26, 2017 at 12:33 pm | Reply

          He could be right; you don’t know. You call it wishful thinking on his part, I call your scenario conjecture on your part. But I appreciate your perspective/comments. I’m not attacking you; just debating ideas.

          • “I call your scenario conjecture on your part.”

            will the economy continue to function if the dollar fails?

    • Stuart, just a few times, very few, it was said that in 2008/9 the world was 48 ours away from total collapse. By people in the know. Almost everything dropped like a rock, only government actions and central bank guarantees saved the system. 48 hours from bartertown. They cannot let that happen again. They’re in control now. Watch what they do, not what they say. In the end, they will shove $ 100 k down your throat and force you to buy stocks with it. Mark my words.

      • “In the end, they will shove $ 100 k down your throat and force you to buy stocks with it.”

        nope, no need to involve the taxpayers at all. instead the captive quisling government will borrow money in the citizens’ name, buy (fill in the blank) with it, and send the few remaining citizens the bill for the debt and the interest.

        • DisappearingCulture | April 26, 2017 at 4:31 pm | Reply

          “…..buy (fill in the blank) with it,….”
          Bombs and other military armaments?

          • “’…..buy (fill in the blank) with it,….’
            Bombs and other military armaments?”

            anything. anything at all. more bombs, more education programs for the ghetto, more funding grants to study the mating habits of lower slobovian dung beetles, digging more holes, filling more holes and re-digging them – anything. the antepenultimate point is to increase the debt for which the remaining citizens are held liable – eternal, inextinguishable, ever-increasing debt. the penultimate point is universal confiscation of all assets, leaving the remaining citizens with nothing but debt. the ultimate point is for the “global elite” “international financiers” “deep state” to sit like an effendi and eat.

        • I will buy you a sandwich with my last silver ounce gman.

          • “I will buy you a sandwich with my last silver ounce gman.”

            some decades ago an experiment in total ecological isolation was conducted. a small group of people locked themselves inside a completely sealed habitat for a year, just to see if humans could run their own environment. about a month in one of the guys decided he wanted a pizza, and set about doing all the work himself to make one. he planted the wheat, grew it, harvested it, ground it, baked it. he tended the goat and milked it and set the milk to cheese. after six months he finally got his pizza.

            thanks for the offer, but that sandwich will cost considerably more than one oz of silver.

            (you can find the experiment record on-line. last I heard the facility is still operated as a museum by the participants.)

          • Yeah, i know the drill. Phyz won’t help us survive. Maybe useful when fiat fails and ‘they’ come up with fiat 2.0, backed or unbacked. I’ll exchange my tiny stack for something useful or productive. Good to have a realist over here gman, but i’ll keep challenging your lack of hopium 😜

          • houtskool,

            If gman was a TRUE REALIST, he would spend less time in here making hundreds of comments, and more time perfecting his SURVIVAL SKILLS.

            That being said, there is no guarantee of what the value of gold and silver will be in the future. However, I have stated that it IF YOU HAVE SURPLUS FUNDS… you are better off owning physical gold and silver, than most other paper assets and real estate. So, I am not saying that GOLD & SILVER will be the SAVOIR of all ones problems in the future…

            RATHER… the more important thing is that they will offer MORE OPTIONS than most other paper assets.

            gman… is more than welcome to come in here and post another hundred comments playing Devil’s ADVOCATE. Heck, I love it because it generates more traffic and activity.

            steve

          • “i’ll keep challenging your lack of hopium”

            https://i0.wp.com/i122.photobucket.com/albums/o276/el_Sooper_MexyCon/OBAMA-MATH-IS-HARD-HOPE-IS-EASY.jpg

            “RATHER… the more important thing is that they will offer MORE OPTIONS”

            .357 vs .45, or 5.56 vs .308, will be the primary options.

          • “gman… is more than welcome to come in here and post another hundred comments playing Devil’s ADVOCATE.”

            don’t forget to share with all your country friends what I said about rural areas being mostly economic banana republics, so you can all laugh together at how stupid I am. good times ….

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