Archive | Gold and Silver

Gundlach Sounds Alarm on ‘Paper Gold’ ETFs Raking in Billions – by Katherine Greifeld and John Gittelsohn (Bloomberg News – April 1, 2020)

Jeffrey Gundlach has a warning for investors piling into gold-backed ETFs: Don’t think you’ll get the physical metal back.

State Street Corp.’s $50 billion SPDR Gold Shares ETF, ticker GLD, attracted $2.9 billion of inflows last week, its biggest haul since 2009, as haven demand amid escalating coronavirus fears boosted the metal. Meanwhile, assets in gold ETFs climbed to a record on Tuesday, according to data compiled by Bloomberg.

The demand for such ETFs is flashing a warning sign for DoubleLine Capital’s chief investment officer, who cautioned against the products during a webcast Tuesday. Continue Reading →

Buying ‘paper gold’ ETFs could be ‘huge failure’ if gold is in short supply — Bond King Gundlach – by Anna Golubova (Kitco News – April 2, 2020)

(Kitco News) Surging demand for gold-backed exchange-traded funds is raising a red flag for DoubleLine CEO and Wall Street’s Bond King Jeffrey Gundlach.

Purchasing “paper gold [ETFs] could be a huge failure in entire gold-delivery system” as there is not enough of the yellow metal to cover all the paper demand, Gundlach said in a Tuesday webcast.

If, after buying a gold-backed ETF, investors might want to get their hands on that physical gold, there might not be any left, Gundlach warned. After big inflows last week, holdings in gold ETFs tracked by Bloomberg rose by another 16 metric tons Monday, putting them above 90 million ounces or over 2,800 tons for the first time, Commerzbank said. Continue Reading →

INV Metals’ Ecuador project shines in updated feasibility study – by Mariaan Webb ( – April 1, 2020)

The strong gold price is underpinning robust economics of one of Ecuador’s five strategic mining projects, with an updated feasibility study calculating the Loma Larga gold project’s aftertax net present value (NPV) at $454-million and its internal rate of return (IRR) at 28.3%.

Developer INV Metals this week announced the results of the updated feasibility study, which incorporates the relocation of the plant infrastructure and tailings facility near the proposed mine site, updated capital and operating cost estimates and current mineral resources and reserves.

CEO Candace MacGibbon reports that the capital and operating costs have not changed materially since the results of the previous feasibility study in January 2019, but notes that the gold price environment has strengthened with the updated study working on a long-term price of $1 400/oz. Continue Reading →

Two northern B.C. gold mines poised to start digging – by Arthur Williams (Business In Vancouver – March 30, 2020)

With gold bouncing above a six-year high of US$1,600 per ounce and holding steady so far through the COVID-19 crisis, greater attention is now placed on two gold-mining plays in northern B.C.

One was envisioned in 2012 and approved two years ago but has yet to start; the second has received government and First Nations support and is also waiting for the mine owner to start construction.

The Blackwater gold mine, owned by New Gold Inc., will be an open-pit gold and silver mine on 4,400 hectares about 110 kilometres southwest of Vanderhoof. Continue Reading →

Silver market faces supply crunch as Mexico curtails production – by Neils Christensen Neils (Kitco News – April 1, 2020)

(Kitco News) – Expected mine shutdowns of at least a month in Mexico will reduce the global silver supply since the country is the world’s largest silver producer.

Nevertheless, analysts are not rushing to say this will automatically mean higher silver prices, as normally occurs when there are reduced supplies in any commodity. That’s because in this instance, industrial demand is also suffering as the COVID-19 pandemic impacts the global economy. Further, with refinery and transportation issues but sharply rising physical demand, silver was described as a market “in turmoil.”

The Mexican government this week declared the pandemic as a national health emergency and as a result is forcing all non-essential businesses to close up shop until at least April 30. Silver miners likely are considered non-essential. Some mining and exploration companies have already said they are halting operations. Continue Reading →

Don’t Expect a Crisis to Be Good for Gold – by David Fickling (Bloomberg/Yahoo Finance – April 1, 2020)

(Bloomberg Opinion) — Here’s another factor to add to the gyrations in the gold price over the past few weeks: The biggest players in the market may be losing their buying appetite.

Russia’s central bank, one of the world’s largest gold buyers in recent years, is halting all purchases of the metal. It’s not alone: Uzbekistan and Kazakhstan, whose central banks have also been reliable consumers of late, have also slowed down.

Rolling three-month additions to official sector gold holdings (those held by central banks and international institutions such as the International Monetary Fund) in January amounted to just 67 metric tons, the slowest pace since August 2018. Continue Reading →

Subsistence miners lose out as coronavirus crushes local gold prices – by Helen Reid and Jeff Lewis (Reuters U.S. – March 31, 2020)

JOHANNESBURG/TORONTO, March 31 (Reuters) – Informal gold miners from South America to Africa are selling gold at almost 40% discounts as measures to curb the coronavirus crimp supply routes and dry up funding.

Border restrictions and flight cancellations have created gold gluts in local markets, depressing prices for small-scale miners even as global prices are pushed back towards 7-year highs by investors piling into bullion as a safe-haven asset.

Artisanal miners – subsistence workers who typically use rudimentary techniques – number around 40 million worldwide, according to a 2019 estimate by Delve, an artisanal mining database. Continue Reading →

World’s Top Gold Market Freezes as Chinese Shoppers Stay Away – by Annie Lee and Jinshan Hong (Bloomberg/Yahoo – March 31, 2020)

(Bloomberg) — The coronavirus pandemic has frozen the Chinese gold market, torpedoing demand at a time when investors elsewhere in the world are clamoring for the safety of bullion.

China is the biggest buyer of gold bars, coins and jewelry, but the national shutdown to contain the virus has emptied malls, while the premium charged to buy the metal in China has evaporated. It leaves the industry staring down a long road to recovery, even as Beijing tries to jump-start broader consumption with a campaign to get shoppers out and about.

The market’s struggles in China may present a headwind for prices, which last month topped $1,700 an ounce for the first time in seven years. The traditional haven also faces a drag from slower retail consumption in India, Europe and the U.S., as well as Russia’s surprise decision to halt purchases by its central bank. Last year, Chinese consumers accounted for about a fifth of total gold demand of 4,356 tons, according to the World Gold Council. Continue Reading →

Can silver price deliver in 2020? – by Anna Golubova (Kitco News – March 31, 2020)

(Kitco News) With gold back on the radar for a lot of investors, attention is now turning to silver but can it deliver alluring returns this year? Prior to the March sell-off, silver was doing well as a precious metals hedge, but its industrial component has been weighing it down.

“Both gold and silver have monetary safe-haven qualities, unlike most commodities, which historically sell-off during periods of equity market weakness and/or heightened concerns regarding the health of the global economy,” said Jordan Eliseo, senior investment manager at The Perth Mint. “Concerns about the state of the global economy will have possible negative consequences for the industrial metals, and by extension, silver.”

Panic mass sell-off triggered by COVID-19 dragged silver prices to 11-year lows just a couple of weeks ago. Since then, the precious metal has recovered somewhat. Spot silver last traded at $13.96, down 0.43% on the day while May silver Comex prices were last at $14.195, up 0.45% on the day. Continue Reading →

Premier Gold makes US$205M offer to buy out mine development partner – by Staff (Northern Ontario Business – March 30, 2020)

Premier Gold has made a US$205 million offer to buy out Centerra Gold, its joint venture partner in developing a mine in northwestern Ontario, near Geraldton.

In a March 30 news release, the Thunder Bay-headquartered miner indicates there’s another company waiting in the wings to acquire Centerra’s 50 per cent interest in Greenstone Gold Mines (GGM).

GGM is a partnership company set up specifically to put the Hardrock gold project into production. Premier said this proposed company has the financial wherewithal to acquire Centerra’s ownership stake and advance Hardrock through the construction phase. Continue Reading →

Kirkland Lake employee who tested positive for COVID-19 rode in bus with others – by Niall McGee (Globe and Mail – March 31, 2020)

Tony Makuch, the chief executive of Kirkland Lake Gold Ltd., says a male employee who recently tested positive for the novel coronavirus left its Detour Lake mine in northern Ontario mine a couple of weeks ago on a bus with symptoms alongside other employees.

The individual, who tested positive for COVID-19 on Thursday, had spent a couple of days in self-isolation at the mine after getting sick earlier in the month before getting on the bus bound for Cochrane, Ontario.

About 25 other employees shared the more than two hour coach ride with the individual. Mr. Makuch said it never occurred to anyone that the man should have been escorted out of the site in an ambulance, so as to reduce the risk of virus spread to others on the bus. Continue Reading →

Gold’s winning streak forgives local miners’ many sins – by Peter Ker (Australian Financial Review – March 31, 2020)

Gold prices in Australian dollar terms have charged above $2700 for the first time, letting Newcrest Mining and three other big gold miners escape without major punishment from a raft of production downgrades in the past three months.

At $US1679 per ounce on Monday, the gold price was not far below the seven-year highs set in the past month on the back of interest rate cuts and quantitative easing in many nations, including the US.

Fears of a global recession have only fuelled the rush to buy gold, which is the traditional safe haven for investors. The local price exceeded $2000 per ounce for the first time in June 2019, and on Monday was above $2700 per ounce. Continue Reading →

Nunavut mine goes into “lockdown” to reduce risk of COVID-19 – by Jane George (Nunatsiaq News – March 29, 2020)

Agnico Eagle Mines Ltd. says its Meliadine mine in Nunavut is in “complete lockdown” for the next 28 days, with no movement of personnel except for emergency situations, to help prevent the potential spread of COVID-19.

The measures, which take effect on Monday, March 30, were announced by the company following a social media uproar created by an employee of one of the mine’s contractors who made dismissive remarks about the mine’s efforts to screen for the new coronavirus.

That’s although the company told Nunatsiaq News that the measures had already been decided on beforehand. These are the comments that angered many in Rankin Inlet who have been worried about the spread of the new coronavirus into their community of about 3,000. (Screen shot) Continue Reading →

Coronavirus Sparks a Global Gold Rush – by Liz Hoffman, Amrith Ramkumar and Joe Wallace (Wall Street Journal – March 27, 2020)

It’s an honest-to-God doomsday scenario and the ultimate doomsday-prepper market is a mess. As the coronavirus pandemic takes hold, investors and bankers are encountering severe shortages of gold bars and coins. Dealers are sold out or closed for the duration.

Credit Suisse Group AG, which has minted its own bars since 1856, told clients this week not to bother asking. In London, bankers are chartering private jets and trying to finagle military cargo planes to get their bullion to New York exchanges.

It’s getting so bad that Wall Street bankers are asking Canada for help. The Royal Canadian Mint has been swamped with requests to ramp up production of gold bars that could be taken down to New York. Continue Reading →

Barrick unveils 10-year plan to become world’s most valued gold miner – by Cecilia Jamasmie ( – March 26, 2020)

Barrick Gold (TSX: ABX) (NYSE: GOLD), the world’s second largest gold miner, has unveiled a 10-year production plan aimed at becoming the most valued bullion company.

The strategy, outlined in its first annual report since its merger with Randgold Resources, includes boosting Barrick’s production to about 5 million ounces of gold a year, with the bulk coming from its North American operations.

President and chief executive officer, Mark Bristow, said Nevada Gold Mines — its recent joint venture with Newmont (NYSE: NEM) — would be the “value foundation” of its business moving forward. Continue Reading →