Mixed mining companies due to volatility in metals

The drop in the international price of precious metals has affected mining companies such as Industrias Peñoles and Fresnillo on the Mexican Stock Exchange (BMV), while the rise in industrial metals has benefited Grupo México and Autlán.

Fresnillo, a subsidiary of Industrias Peñoles, registers the biggest drop in the BMV with a 20.67% loss so far in 2021, trading at 238 pesos per share. While in its stock market of origin in London it has a fall of 18.28% this year to 923 pence.

For its part, Industrias Peñoles has a decrease of 11.36% and its shares operate at 298.53 pesos on the BMV.

Both companies are mainly engaged in the extraction and production of gold, which registers a loss of 5.06% in 2021, and sells for $ 1,809.45 per ounce on the Chicago Derivatives Exchange (CME for its acronym in English). In addition, the precious metal shows a loss of 9.6% from its maximum of the year on January 6 after reaching 1,971.50 dollars per ounce.

Other metals also registered losses in the year, such as silver with a drop of 7.38% and platinum with a drop of 1.66 percent.

In the case of Peñoles, according to its financial reports, until the second quarter of this year, 35.8% of its income was from gold and 31.2% from silver. In contrast, 73% of Fresnillo’s production is gold.

Alejandra Vargas, industrial sector analyst at Banco Ve por Más, commented that there is greater volatility in the market, “derived from the effects on the distribution chains caused by the pandemic, as well as the increase in inflation levels, therefore that in the case of precious metals the average price has decreased ”.

Minera Frisco also reports a loss so far in 2021 on the BMV of 4.20% and is sold at 3.88 pesos per share.


On the other hand, the mining companies that still have profits on the BMV are Autlán with a 23.49% increase to trade at 13.09 pesos per share and Grupo México with 13.45% so far in 2021 with a price per paper of 95.43 pesos.

Alejandra Vargas said that in the case of Minera Autlán reported an increase in net income and operating cash flow (EBITDA) derived from the recovery of the industry. “The mining company reported an increase in EBITDA of 109.4% compared to the same quarter of 2020, at 37.6 million dollars, this was a maximum of the last 12 years.”

Metals such as copper, aluminum and zinc remain with gains of 26.72, 46.16 and 24.92%, respectively, which has sustained the gains for mining companies such as Grupo México, which has 80% of its production focused on copper.

“These metals, unlike gold and silver, are used in the industrial sector and as the reopening of economic activity advances worldwide, their demand has increased, mainly for copper, with China being its largest consumer,” he said. Heriberto Sandoval, Investment Advisor at Increase Kapital.

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