Copper market’s biggest whale fuels speculation of a major shift
The world’s single biggest buyer of copper, State Grid Corp. of China, has slowed its purchases of copper wire this year.
Sierra Metals (TSX: SMT) is placing its Cusi silver mine in Mexico on care and maintenance and has started the process to sell the mine amid the company’s shift towards copper. SCP Resource Finance will act as financial advisor for the Cusi mine sale process.
“Earlier this year, the company deemed the Cusi silver mine a non-core asset, and given current market conditions has made the difficult decision to put the mine on care and maintenance,” Sierra Metals CEO Ernesto Balarezo Valdez said in a press release.
“In efforts to crystalize value for shareholders we have a process underway to sell Cusi. Sierra is transitioning to become a copper-focused mining company,” he added.
The planned sale of the Cusi mine, according to Valdez, would allow Sierra to focus on its two key mines, Yauricocha in Peru and Bolivar in Mexico, where he believes have “significant potential to continue growing our copper production.”
Located in Chihuahua state, the Cusi underground mine has the capacity to produce 1,200 tonnes per day from a processing plant that includes a conventional ball mill and flotation plants fed from a crushing circuit. The flotation circuit has the ability to produce silver, lead and zinc concentrates.
Last year, the Cusi mine produced roughly 1.5 million silver-equivalent ounces using sub-level caving and long-hole mining methods, at an all-in sustaining cost (AISC) of $23.17 per silver-equivalent ounce sold.
