Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

A slew of Industrias Peñoles’ mining project upgrades is likely to be realized between Q4 2020 and Q1 2021.


The Mexican miner, while announcing its Q3 results on Oct 28, said that the optimization of a flotation plant at its subsidiary, Fresnillo, was on track to be completed by Q4. Once operational, the updated plant will be able to process ore that has higher lead and zinc content.


The company’s Reina del Cobre project in Durango, Mexico is slated to begin operations by the beginning of 2021, and operations at the miner’s Fortuna del Cobre project in Sonora will resume by the end of the year.


The company’s lead, zinc, and copper production fell by 0.2pc, 1.2pc, and 5.6pc, respectively, in the nine months ended September 30 compared with the same nine-month period last year. Copper cathode production declined by 37.5pc during the same period under comparison. The company attributed the decline in output to a reduction in mine operations, due to the COVID-19 pandemic during the period.


In Q3 2020, lead and zinc production saw steeper falls, declining by 10.5pc and 11.7pc, respectively, from the same quarter in 2019. Copper output inched up by 0.1pc although copper cathodes production more than halved during the same period.

MetalQ3 2020 
(in mt)
Q3 2019 
(in mt)
% change

Jan-Sep 2020 

(in mt)

Jan-Sep 2019 

(in mt)

% change
Lead concentrate30,16529,7611.481,96586,259-5.0
Zinc concentrate57,73770,529-18.1188,102207,983-9.6
Copper cathode2,7466,170-55.510,75617,212-37.5


The miner, which also produces silver and gold reported that higher sales and prices of the precious metals helped in shoring up the company’s sales revenues during the quarter. Peñoles’ consolidated net sales in the first nine months of the year fell by 4.2pc to $3.20bn from $3.34bn in January-September 2019. However, sales rose by 11.6pc in Q3 2020 to $1.23bn from $1.10bn during the same quarter last year.


The miner’s EBITDA rose 30.5pc in January-September to $949mn from $727.5mn during the same nine-month span in 2019. In Q3, EBITDA increased by 73.3pc to $466.4mn from $269.2mn in Q3 2019. Gross profit also increased in the nine months period by 20.2pc to $780.4mn compared with $649.2mn in January-September 2019, while gross profit in the third quarter climbed by 72.4pc to $409.8mn from $237.7mn in Q3 2019. 

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