LATAM Weekly News

2nd June 2021

Gold is a major resource for Latin America, so this week I want to take a brief look at what's happening there.

Analysis from Resource World this week has provided some insights into why the gold price is still riding high as other commodities that have recently seen surges have faltered.  Investors are retreating to the security of gold as US Treasury bond returns dip well below inflation levels and the cryptocurrency buzz loses steam on the back of extreme volatility.

The Daily Gold has also suggested that the time of gold stocks could have come, as investors show early signs of more interest in stocks compared to metal for the first time since the 2008 crash.  This is based on the graph below, which shows gold relative to gold stocks since the crash.

If that outcome comes to fruition, it would be great news for Latin American gold juniors, with more cash flowing into gold stocks meaning more money for development and exploration.  The Latin American region as a whole is a major source of gold for the rest of the world, with regions like the Andes and Sierra Madre Occidental containing world-class mines and many smaller operations.  If the price of gold metal remains high and gold stocks outperform even that, it could mean a flush of cash that could get drill rigs turning.

Around the Traps

Mammoth Resources (TSXV:MTH) has exciting news for investors, after it announced a private placement of 14,300,000 shares and then increased it to 18,482,600 shares on the back of high demand.  Even then the offer was oversubscribed.  Mammoth will use the $2,587564 generated for exploration work on its Tenoriba gold-silver project in the Sierra Madre region of Mexico.

Solgold (TSX:SOLG, LSE:SOLG) has announced its intention to co-operatively advance the large Cascabel copper-gold project in Ecuador alongside Cornerstone Capital Resources Inc. (TSXV:CGP, OTC:CTNXF, FWB:GWN), which comes after difficulties between the two were apparently resolved for the benefit of shareholders.  You can read the news release here.

The Cascabel project in Ecuador reports the emergence of a new major lithium producer, with the PEA for a second deposit at Sigma Lithium’s (TSXV:SGMA) Grota do Cirilo project placing it just outside the top five.  The company believes there is a lot yet to be uncovered at Grota do Cirilo, with nine past-producing mines on the large project, and Sigma intends to flexibly produce either carbonate or hydroxide at the site, according to market conditions.

Fertile ground at Sigma's Grota do Cirilo project

BHP’s labour woes continue in Chile, although the company says that operations at its Escondida and Spence mines are running normally after it brought in replacement workers to its Integrated Operations Centre in Santiago, according to Reuters. That move has been contested with labour authorities by striking workers, and on-site workers at Spence and Escondida are moving in the direction of strike action as well.

That's all for this week, take care everyone!

- Jane Lockwood

Spotlight Mining are sponsored by Goldplay MiningRiverside ResourcesMountain Boy MineralsSolgoldVangold MiningOrigin Exploration and Mammoth Resources. This sponsorship means we may show preferential bias in the order in which we publish news and updates.