November US Jobs Data May Boost Silver Prices

Kevin McCoy [GFDL ( or CC-BY-SA-2.0 (], via Wikimedia Commons

Silver recorded its worst price since mid-August last week, and unfortunately for fans of the white metal, this week brought no improvement. 

The week began promisingly enough, with silver sitting at $19.76 per ounce, up from last week’s low of $19.54, early Monday morning. However, by the end of the day, “favorable US scheduled data” had pushed the precious metal to $19.21, as per Capital Trading Group. Also undermining the precious metal were “adverse currency market action” and “noted weakness in platinum and copper prices.”

Tuesday was a fairly steady day for silver, which traded between $19.36 and $19.07. However, the next day, it took another plunge, heading below $19 to hit $18.93. In another report, Capital Trading Group said that the white metal seemed to have followed gold downward, giving “gold price action more” clout than “its own potentially supportive internal fundamental factors.”

Since then, silver has managed to pick itself back up a little. After hitting a low of $19.36 this morning, it closed the day at $19.44.

Encouragingly, Standard Bank said earlier this week that prices may see some improvement tomorrow, after the US Bureau of Labor Statistics releases the country’s official November employment data.

Company news

On Monday, Santacruz Silver Mining (TSXV:SCZprovided an update on its operations during the third quarter of 2013, commenting that its Mexico-based Rosario mine is on target to become cash-flow positive by the end of 2013. The company hopes that by the end of Q1 2014, the mine will be producing 500 tonnes per day.

Arturo Préstamo, president and CEO of Santacruz, said, “[w]e have overcome many of the early stage challenges of a new mine and have made significant strides towards our goal of operating at 500 tpd by the end of Q1 2014. Notwithstanding these positive strides we expect to continue making improvements in order to develop the mine properly aiming to have a cost-effective mine for many years to come.”

Two days later, First Majestic Silver (TSX:FR,NYSE:AG) announced that the new 1,000-tonne-per-day cyanidation circuit at its Mexico-based Del Toro silver mine started producing silver doré bars on November 20 of this year.

The move puts the company on track to record its 10th year in a row of growth in silver production, according to Keith Neumeyer, First Majestic’s president and CEO.

This afternoon, Alexco Resource (TSX:AXR,NYSEMKT:AXU) released a NI 43-101 compliant preliminary economic assessment (PEA) for the eastern part of the Keno Hill Silver District, located in Yukon, Canada.

The PEA assesses “an expanded operations phase of silver, lead, zinc and gold production” in the area, with highlights including yearly delivery of an average of 3.1 million ounces of payable silver, 6.8 million pounds of lead, 6.6 million pounds of zinc and 1,050 ounces of gold from about 150,000 tonnes per year of consolidated mine and mill production. It also outlines an after-tax internal rate of return of 38 percent and an after-tax net present value of $29.6 million.

Alexco states in today’s press release that the PEA is “one of a number of production strategies” it is considering

Junior company news

Trevali Mining (TSX:TV,OTCQX:TREVF) released on Tuesday a November update on commissioning at its Santander zinc-lead-silver mine, located in Peru, noting that during that month, mill throughput “continued at full nameplate capacity” of 2,000 tonnes per day for “an effective monthly plant availability of 100%.” Average head grades from a mix of underground feed and stockpiled surface material were 4.7-percent zinc, 1.6-percent lead and 1.9 ounces per tonne silver.

The company was able to sell and deliver about 5,000 tonnes of zinc concentrate and 900 tonnes of lead-silver concentrate to its partner, Glencore Xstrata (LSE:GLEN).

Earlier today, Golden Arrow Resources (TSXV:GRGput out the results of the PEA for its Argentina-based Chinchillas silver-lead-zinc project. Highlights include a mine life of 12 years in an “[o]pen-pit mining scenario with a processing design of 6,000 tonnes per day at a 2.2:1 strip ratio.” The PEA also shows an after-tax net present value of $98.5 million at an 8-percent discount rate, as well as an internal rate of return of 17.5 percent.

Brian McEwen, vice president of exploration and development at Golden Arrow, said that “[t]he existing Chinchillas resource has room to grow in nearly every direction, and over the next six months we will work to upgrade and expand the resource, delineate new mineralization on the property, and move the project towards a feasibility stage.”


Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article. 

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