Fresnillo gold output rises 13.8% as silver falls on lower ore grades

Fresnillo Plc reported a 13.8% sequential increase in attributable gold production to 154,800 ounces in the second quarter, while silver output slipped 1.7% to 10.9 million ounces as lower ore grades at Saucito and Ciénega weighed on the precious metals miner's results.

"Looking ahead to the second half of the year, our operational plans are tracking in line with expectations," Octavio Alvídrez, chief executive officer of Fresnillo, said. "We will continue to focus on efficiency, cost control, and consistent volume performance across our operations to drive shareholder value."

The gold rebound was driven mainly by higher volumes processed at Herradura, with Fresnillo and Saucito also contributing through improved grades and throughput. Still, gold output fell 1.9% from a year earlier, while first-half production of 290,900 ounces was down 7.3% versus the same period in 2025, reflecting lower grades, volumes and recovery rates at Herradura.

Silver production for the first half totaled 22.0 million ounces, an 11.4% decline from a year earlier, hurt by the end of the Silverstream agreement, lower grades at Saucito, Juanicipio and San Julián Veins, and weaker performance at Ciénega. By-product lead output rose 13.3% quarter-on-quarter to 17,438 tonnes, while zinc increased 5.9% to 27,672 tonnes.

Fresnillo maintained its full-year 2026 guidance, targeting attributable silver production of 42.0 million to 46.5 million ounces and gold output of 500,000 to 550,000 ounces, equivalent to 82 million to 91 million silver-equivalent ounces. Guidance for 2027 and 2028 also remains unchanged. The company also announced that Tomás Iturriaga stepped down as chief operating officer for the Central Region, with Gabriel Durán assuming interim responsibility. Fresnillo will report its 2026 interim results on Aug. 4.

The production figures come as Fresnillo navigates a period of declining ore grades across several key assets, a challenge common among mature precious metals mines. Peer producers including Newmont Corp. and Agnico Eagle Mines Ltd. have also faced grade-related headwinds at certain operations, underscoring the industry-wide pressure to replace depleting reserves through exploration and acquisitions. Fresnillo's reaffirmed guidance suggests management expects the second-half performance to offset the first-half shortfall, with the company's recent entry into Canada through the acquisition of Probe Gold Inc. signaling a longer-term growth strategy beyond its core Mexican operations.

This article is for informational purposes only and does not constitute investment advice.