Visualizing Peru’s Silver Mining Strength

Peru’s silver mining industry is critical as the world progresses towards a clean energy transition. Silver’s use in EVs, solar energy, and mobile technologies will require ready supplies to meet demand.

Peru will be centre stage as the world’s second-largest producer of the precious metal.

This graphic sponsored by Silver X showcases Peru’s silver mining strength on the global scale, putting in perspective the country’s prolific production.

Global Silver Production by Country

Mexico, Peru, and China dominate global silver production, with these countries producing more than double the silver of any other country outside of the top three.

In terms of regional production, Central and South America provide the backbone for the world’s silver industry. With five nations in the top 10 producers, these regions delivered ~50% of the world’s 2020 silver production.

Along with being the top silver mining regions in the world, Central and South America silver production expects to have the strongest rebound in 2021.

While global silver production could increase by 8.2%, Central and South America’s production could rise by 12.1%.

Peru can feed this growth, with the country’s exploration investment forecast for this year expected to reach up to $300 million with over 60 projects currently in various stages of development.

The South American Powerhouse: Peru’s Silver Mining Strength

Despite its current silver production, there remains more to mine and explore. In fact, Peru holds the majority of the world’s silver reserves with 18.2%, making it the global focal point for silver exploration and future production.

While 2020 and 2021 saw slowdowns in mineral production, Peru’s metallic mining subsector increased by 5.1% in August 2021 compared to the same month last year. The country’s National Institute of Statistics and Informatics also highlighted a double-digit rise in silver production of 22.7% compared to August of last year.

Satiating the World’s Silver Demand

As silver demand is forecasted to increase by 15% just in 2021, silver supply constraints are a clear roadblock for clean energy technologies and electric vehicle production. With Peru’s annual silver production forecasted to grow by more than 27% by 2024, the country is looking to solve the world’s growing silver supply crunch.

The nation’s strong credit ratings and well-established mining sector offers investors a unique opportunity to tap into the growth of Peru and its silver industry, while powering renewable energy and electric vehicle production.

As a Peru-based mineral development and exploration company, Silver X Mining is working to produce and uncover the silver deposits that will provide the world with the metal it needs for cleaner technologies.

The Road to EV Adoption: Fast Lanes and Potholes

Electric vehicles (EVs) are a key piece of the clean energy puzzle.

However, the road to electrification is influenced by various factors. While some are helping speed up the switch to EVs, others are slowing it down.

The above infographic from Rock Tech Lithium outlines the fast lanes accelerating mainstream EV adoption, and the potholes slowing it down.

The Fast Lanes Accelerating EV Adoption

From government policies to falling battery prices, a number of factors are putting EVs in the fast lane to consumer adoption.

Factor #1:

Promoting Policies

The shift to a clean energy future is slowly moving from a goal to a reality.

Governments around the world have made automobile electrification a key part of public policy. More than 20 countries are targeting a complete phase-out of vehicles that emit greenhouse gases over the next two decades. Furthermore, 35 countries have pledged for net-zero economies by 2050, where EVs will play a key role.

As an example, here’s a recent tweet that U.S. President Joe Biden wrote before signing an executive order to make 50% of the U.S. auto fleet electric by 2030:

“The future of the auto industry is electric—and made in America.”

—President Biden on Twitter

Given the increasing importance of EVs, it’s no surprise that governments are not only promoting auto electrification but also incentivizing it.

Factor #2:

Consumer Awareness

The rapid growth of the EV market is partly due to consumers that are choosing to go electric.

Rising awareness around the risks of climate change as well as vehicle improvements from EV manufacturers is spurring EV adoption among consumers. Between 2015 and 2020, consumer spending on EVs increased by 561%, up from $18 billion to $119 billion.

As more consumers switch to EVs, the market will continue to grow.

Factor #3:

More Models

EV manufacturers are recognizing the need for a wider variety of vehicles to meet the needs of different consumers.

The number of available EV models has increased from 86 in 2015 to over 360 in 2020, and thanks to recent announcements from the auto industry, this trend is likely to extend over the next decade.

¹Hyundai is the parent company of Kia Motors.
²Refers to the Renault-Nissan-Mitsubishi Alliance.
Source: IEA

With more models available, consumers have a wider variety of cars to choose from, reducing the barriers to EV adoption.

Factor #4:

Falling Battery Prices

Batteries are the most expensive and important components of EVs.

Improvements in battery technology, in addition to expanding production, have driven down the cost of EV batteries. As battery costs fall, so do EV prices, bringing EVs closer to price-parity with gas-powered cars.

Source: BloombergNEF

According to BloombergNEF, at the battery pack price point of $100/kWh, EV prices will become competitive with gas-powered cars, providing a boost to electrification.

All of the above factors are playing a major role in accelerating the EV transition. So what’s slowing it down?

The Potholes Slowing Down EV Adoption

Although the EV market is growing exponentially, it’s still in its early days, with various obstacles to overcome on the way to mainstream penetration.

Pothole #1:

The Supply of Battery Metals

EV batteries rely on the properties of various battery metals to power EVs. In fact, a single EV contains around 207 kg of metals.

As EV adoption grows, the demand for these critical minerals is expected to reach unprecedented highs. In turn, this could result in supply shortages for metals like lithium, cobalt, and graphite, potentially slowing down the growth of the EV market.

To avoid potential shortages, EV manufacturers like Tesla and Volkswagen are vertically integrating to mine their own metals, while governments work to build domestic and independent metal supply chains.

Pothole #2:

Charging Infrastructure

With more EVs on the roads, drivers need more places to plug in and recharge.

However, most countries are lagging behind in the installation of public chargers. The global average ratio of public chargers to EV stock is less than 0.15. This means that on average, there are less than 3 chargers for every 20 EVs.

But there are signs of optimism. Global charging infrastructure has doubled since 2017, and governments are incentivizing charger installations with subsidies and tax rebates.

Pothole #3:

Charging Times

While filling up gas tanks takes less than five minutes, it can take up to eight hours to fully charge an EV battery.

Fast chargers that use direct current can fully charge EVs in a couple of hours, but they’re more expensive to install. However, the majority of publicly available chargers are slow, making it inconvenient for drivers to charge on the go.

As charging technology improves, faster chargers are being developed to boost charge times. According to Bloomberg, new ultra-fast chargers can fully charge EVs in less than 30 minutes. Furthermore, the market share of fast chargers is expected to grow from 15% today to 27% by 2030.

Pothole #4:

Range Anxiety

Compared to gas-powered vehicles, EVs do not go the distance yet.

Limited driving ranges are known to cause “range anxiety”—the fear of running out of power—among EV drivers, presenting a hurdle for mainstream EV adoption. Additionally, the lack of charging infrastructure reinforces the problem of limited ranges.

However, consistent improvements in battery technology are resulting in longer driving ranges. Between 2015 and 2020, the average range for battery EVs increased by 60%. With further technological improvements, extended ranges will allow EVs be compete more aggressively with their gas-guzzling counterparts.

The Decade of the Electric Vehicle

The EV market is growing at a remarkable rate. EV makers sold around three million vehicles in 2020, up 155% from just over one million vehicles sold in 2017.

With several factors driving EV adoption and stakeholders working to overcome the industry’s obstacles, mainstream adoption of EVs is on the horizon.