Silver Shortage Likely On Turmoil In Peru, Mexico, Bolivia
Such turmoil in Peru, Mexico, Argentina and Bolivia may add to the world’s already existing shortage of silver. This supply crunch is combined with rising political uncertainty in Egypt, Syria and Iran and economic malaise in the EU and the United States which is causing investment demand for silver to rise exponentially.
LIMA: Silver supply pressures are likely on turmoil in Peru and Mexico where miners are facing significant challenges including violence, according to Jeb Handwerger of GoldStockTrades.
Among major silver miners, Newmont is facing violent protests in Peru, Pan American Silver is suspending its investments in Navidad project due to rising resource nationalism in Argentian.
Pan American paid $500 million for the asset in 2009. This project may be the richest undeveloped silver deposit in the world, GoldstockTrades reported.
Similarly, Bolivia and Evo Morales is considering nationalizing South American Silver’s(SAC.TO) large undeveloped silver project amidst violent indigenous protests. The company describes it as “one of the world’s largest undeveloped silver deposits.” The company is planning to invest over $50 million into the project. At the same time the Bolivian peasants have violently kidnapped five workers from the project.
Such turmoil in Peru, Mexico, Argentina and Bolivia may add to the world’s already existing shortage of silver. This supply crunch is combined with rising political uncertainty in Egypt, Syria and Iran and economic malaise in the EU and the United States which is causing investment demand for silver to rise exponentially.
On prospects for silver, Jeb Handwerger notes that there are several reasons why the white metal can turn bullish- US dollar may have hit an interim top, markets are awaiting a possible QE 3 stimulus, and inflation threat augurs well for precious metals.
Source: CommodityOnline
Related Articles:
