There are many factors to consider when considering an investment in silver mining stocks, including the
management
team,
silver prices
, and which companies are operating in the top silver-producing countries.
Knowing the top silver-producing countries can help investors understand the logic behind the exploration and development decisions that companies make. For example, high silver production in a particular country might indicate mining-friendly laws or high-grade deposits.
In 2020, Mexico was once again the world’s leading silver-producing country, and world silver production decreased marginally to 257,000 metric tons (MT) due to shutdowns during the COVID pandemic. Below is an overview of the top silver-producing countries. Silver production stats are based on
the latest data from the US Geological Survey
.
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1. Mexico
Mine production: 5,600 MT
Mexico continues to rank as the world’s largest pure silver producer, although its output in 2020 decreased by 320 MT over the previous year. The country is home to Fresnillo (LSE:
FRES
,OTC Pink:FNLPF), the
largest silver company in the world
. Fresnillo’s
silver production
has increased by 1.7 percent in the first half of 2021 over the same period in the previous year.
Fresnillo’s Zacatecas Silver Mine is
one of two of the world’s largest silver mines
located in the Mexican state of Zacatecas. The other is Newmont Corp’s (TSX:
NGT
) Penasquito Polymetallic Mine which is also Mexico’s largest open-pit mine.
2. Peru
Mine production: 3,400 MT
Second on this top silver-producing countries list is Peru, which fed 2020 silver supply by putting out 3,400 MT, down from 3,860 MT in 2019. Peru features the world’s largest-known
silver reserves
, with an impressive 91,000 MT of silver. The country has a massive amount of untapped silver potential that could allow it to challenge Mexico for the top spot in the future.
Most of Peru’s physical silver production comes from the
Antamina mine
, a joint venture between BHP (ASX:
BHP
,NYSE:BHP,LSE:BHP), Glencore (LSE:
GLEN
,OTC Pink:GLCNF), Teck Resources (TSX:
TECK.B
,NYSE:TECK) and Mitsubishi (OTC Pink:
MSBHF
,TSE:8058). It produces more silver bullion than any other mine in the country, but is primarily a
copper
mine with silver produced as a by-product.
Fortuna Silver Mines (TSX:
FVI
,NYSE:FSM) is rapidly growing its silver production with two operating mines on the market, one of which is in Peru. The Caylloma mine
produced 1 million ounces of silver
in 2020.
3. China
Mine production: 3,200 MT
China ranked third in silver production in 2020. The Silver Institute attributes a large part of China’s rise within the bullion market in recent years to the country’s development of its mining industry, as the majority of Chinese silver production originates as a by-product of other metals.
Many companies in China are privately owned, but Silvercorp Metals (TSX:
SVM
,NYSEAMERICAN:SVM) bills itself as the country’s largest primary silver producer. It has a portfolio of producing silver-
lead
–
zinc
mines in China, including the multi-mine Ying District and the GC mine.
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4. Russia
Mine production: 1,800 MT
Russia’s silver output decreased by 200 MT in 2020. The country surpassed both Poland and Chile in silver production this first year. Its silver reserves stand at 45,000 MT, and its largest silver producer is Polymetal International (LSE:
POLY
). Polymetal dominates silver production in Russia and
operates
seven
gold
and silver mines in the country.
Additionally, Silver Bear Resources (TSX:
SBR
) produced the first silver at its Mangazeisky project in Russia in 2019. Mangazeisky includes the high-grade Vertikalny deposit, which the company says is “amongst the highest-grade silver deposits in the world.”
5. Poland
Mine production: 1,300 MT
Poland, another of the top silver-producing countries, saw its 2019 silver production fall by 170 MT compared to the previous year. In the previous year, Russia pushed Poland out of the fourth place spot it held in 2018. The country is in jeopardy of sinking further as its 2020 production figure tied with Chile and Australia.
Poland-based KGHM Polska Miedsz (WSE:
KGH
) is consistently one of the world’s top silver-producing companies, according to the Silver Institute. The country could expand its silver production further as it has 70,000 MT of silver reserves.
6. Chile
Mine production: 1,300 MT
Chile produced nearly the same amount of silver in 2020 as it did the year prior. Most of the silver production in the country is by-product of copper and gold production.
Chile’s state-owned Codelco, one of the world’s top copper producer, is also one of the world’s
top silver producing companies
. The country’s reserves are an estimated 26,000 MT.
7. Australia
Mine production: 1,300 MT
Mines in Australia churned out 1,300 MT of silver in 2020, a slight drop from the 1,330 MT produced the previous year. Silver mining has a rich history in Australia, and BHP began there as a
silver operation
in the 1920s.
Today, South32 (ASX:
S32
,OTC Pink:SHTLF) runs the
Cannington mine
in Queensland, which produces more silver than any other in the country. The company claims to produce
6 percent
of the world’s silver.
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8. Bolivia
Mine production: 1,100 MT
Bolivia, as with many of the largest silver-producing countries on this list, had 2020 output that was on less than the previous year. There is room for its silver industry to expand with reported reserves of 22,000 MT.
Bolivia is home to several silver mines, particularly in its Potosi region. The San Cristobal mine, operated by Sumitomo (OTC Pink:
SSUMF
,TSE:8053), features the
third largest silver reserves
of any mine. In addition, Pan American Silver (TSX:
PAAS
,NASDAQ:PAAS) operates an underground silver-zinc mine in Bolivia called San Vicente.
9. Argentina
Mine production 1,000 MT
Argentina replaced Kazakhstan on the list of major silver producers in 2018, and in 2019 tied with Bolivia as the ninth largest silver producer in the world. At 1,000 MT in 2020, its output is just marginally below the major players; according to the US Geological Survey, silver reserves in Argentina are unknown.
In mid-2018, Yamana Gold (TSX:
YRI
,NYSE:AUY)
began commercial production
at Cerro Moro, a high-grade gold and silver mine in the country. The company
reported
that 2020 production and costs at Cerro Moro were significantly impacted by COVID-19 related restrictions, but the company is planning higher production in 2021. Argentina is also home to the Chinchillas and Pirquitas mines, run by a joint venture between SSR Mining (TSX:
SSRM
,NASDAQ:SSRM) and Golden Arrow Resources (TSXV:
GRG
,OTCQB:GARWF).
10. United States
Mine production 1,000 MT
In 2020, the US produced 1,000 MT of silver, up from the previous year’s 980 MT. Metal was produced at four silver mines and as a by-product at 33
base
and
precious metals
mines. The country’s silver reserves stand at 26,000 MT.
The largest US-based primary silver producer is Coeur Mining (NYSE:
CDE
). Coeur’s US projects are not silver focused, but the company does operate silver mines in South America and Australia.
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Securities Disclosure: I, Melissa Pistilli, hold no direct investment interest in any company mentioned in this article.
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