Background on Key Figures and Context
In the third quarter of 2025, the prices of precious metals gold and silver experienced an unprecedented surge. Gold reached an average price of $3,456.54 per ounce, marking a 39.7% annual increase, while silver traded at $39.53 per ounce, reflecting a 34.4% rise.
This dramatic increase was fueled by a confluence of macroeconomic factors, including global de-dollarization efforts by central banks, ongoing geopolitical tensions in the Middle East and between the US and China, and the expansionary monetary policy of the Federal Reserve.
Furthermore, the growing demand for silver in industries such as photovoltaics and electric vehicles intensified the pressure, resulting in five consecutive years of structural deficits in the silver market.
Impact on Mexican Mining Companies
Amidst this extraordinary scenario, the question arises: did Mexican companies capitalize on these price appreciations? The answer reveals a stark contrast: financial results reached record levels, while production volumes showed an underlying decline.
Case Study: Industrias Peñoles
Industrias Peñoles exemplifies this dichotomy, reporting exceptional financial results with a staggering 652.5% growth in its controlling shareholder’s net income, reaching $301.5 million and an operating cash flow (EBITDA) of $726.6 million.
However, this financial boom stands in stark contrast to its operational performance. Silver production fell 14.5% to 15.5 million ounces, and gold production decreased by 2.9%, primarily due to the exhaustion and permanent cessation of activities at San Julián (disseminated deposit). Zinc refined production plummeted 23.9% due to operational issues.
Peñoles attributed its success to extraordinary prices compensating for lower sales volumes.
Case Study: Grupo México
Grupo México demonstrated superior strategic execution. While it also reported over 50% growth in consolidated net income ($1,290 million) and EBITDA of $2,510 million, its operational decisions were deliberate.
The company reduced copper production by 5.5% to prioritize the production of metals with better margins in the current context.
As a result, zinc production increased by 46.3%, driven by Buenavista Zinc operations, and silver production rose by 2.1%. Grupo México’s true strength lay in its cost discipline, achieving an effective net cost of just $0.78 per pound in the quarter, benefiting from higher subproduct credits like silver, zinc, and molybdenum.
Mixed Performance Across the Sector
The rest of the sector displayed a mixed picture. Minera Frisco showed signs of a fragile recovery, with an accumulated EBITDA of 4,240 million pesos by the third quarter of this year. However, its current strategy focuses on suspending operations (El Coronel, San Felipe, Ocampo) to concentrate on profitable exploration while grappling with substantial debt.
Compania Minera Autlán, on the other hand, was left behind due to its specialization in manganese ferroalloys for a contracting global steel industry (-1.4%). This forced the company to post a net loss of $10.67 million, prompting it to seek diversification by selling its first gold ounces in the past two years.
Key Questions and Answers
- What drove the surge in gold and silver prices in Q3 2025? The increase was fueled by global de-dollarization efforts, geopolitical tensions, and expansionary monetary policy.
- How did Mexican mining companies perform amidst these price increases? Financial results reached record levels, but production volumes showed an underlying decline.
- What strategies did Industrias Peñoles and Grupo México employ in response to these market conditions? Industrias Peñoles capitalized on high prices, while Grupo México prioritized metals with better margins and maintained cost discipline.
- What challenges did other mining companies face in this context? Minera Frisco focused on exploration amidst debt issues, and Compania Minera Autlán sought diversification due to the contracting steel industry.
