Metals & Mining: Beyond the deep

Jun 28, 2013

Miners across Latin America are scaling back capex and looking further afield for funding as they keep an eye on the longer term amid falling prices for metals

By Karen Schwartz


Toronto-based Vena Resources is one of a number of like-minded companies exploring locations across Peru to set up mines. The firm is hopeful that someday soon, it can turn one such site into a profitable operation.

But as markets turn against the industry, its goal has just become a lot harder.

Miners across the region are suddenly grappling with falling metals prices, having already been stung by increasing competition and rising salaries. Concerns over an economic downturn in China - long the driver of demand for the industry - are quashing hopes that metals prices will recover any time soon.

"It has become very, very difficult for exploration companies to survive in this marketplace," says Juan Vegarra, a Peruvian who is chairman and CEO of the Canadian firm.

The bear turn on miners is clear from a cursory look at the market. Stock prices of large miners have fallen...

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“The crisis has been a setback for reserve diversification."

Jan Dehn, Ashmore Investment Management