Mexico's mining industry sees strong growth in May

Mexico’s mining activity continued to recover in May, growing 12.5% year-on-year in real terms after having fallen in the first quarter, according to statistics office Inegi.

Metallic and non-metallic mining began to regain momentum in April with year-on-year growth of 5% after contracting by the same percentage in March.

On May 21, the price of gold hit its highest so far this year at US$2,427.3/oz while silver has also experienced a bullish streak this year.

In the first five months of the year, mining activity increased 2.7% compared to the same period 2023, according to Inegi's monthly report.

Mining services plummeted 13.7% in May after suffering a drop of 4.6% in April and almost 17% in March. Between January and May, mining services declined 9%.

The sector has been affected by the freezing of new concessions by the Andrés Manuel López Obrador government, as well as the uncertainty generated after the mining reform of May 2023 which, among other changes, gave geological service SGM exclusive exploration rights.

The lack of regulations for the four modified laws that apply to the sector is holding back various projects, especially those linked to exploration.

Last week, mining chamber Camimex warned that the reforms included various provisions that were unviable, with exploration being the most affected.

Camimex said the challenge is to work together with the authorities on a new legal framework for the mining industry that encourages responsible investments.