Hochschild sees lower production

Latin American precious metals group Hochschild Mining forecast lower production for 2011 and said costs would continue to rise, after record gold and silver prices boosted profits for 2010.

The company expects production to drop by nearly 15 per cent in 2011 as it moved to lower output at its Arcata mine in Peru, while costs are expected to rise 10 per cent in Peru and at least 25 per cent in Argentina.

“2010 was not only a year of high prices but also of high cost inflation,” Hochschild said, adding that unit costs at underground operations were up 16 per cent mainly due to local price inflation in Argentina.