ii view: silver miner Fresnillo cuts production targets for 2026
Offering exposure to precious metals, we assess prospects for this FTSE 100 Mexican headquartered mining company.
28th January 2026 11:21
by Keith Bowman from interactive investor
Fourth-quarter production update to 31 December
- Silver production of 12.2 million ounces (moz), up 5.9% from Q3
- Gold production of 135.3 kilo ounces (koz), down 10.6% from Q3
Guidance:
- Now expects full-year 2026 silver production of 42-46.5 moz, down from a previous 45-51 moz
- Now expects full-year 2026 gold production of 500-550 koz, down from a previous 515-565 koz
Chief Executive Octavio Alvidrez said:
"I am pleased to report another year of solid operational performance. These results demonstrate the resilience of our asset base and the consistent execution of our operations throughout the year.
“As we look ahead, we remain focused on our priorities of safety, operational discipline and efficiency to maximise value in a supportive metals price environment."
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ii round-up:
Precious metals miner Fresnillo (LSE:FRES) today lowered its silver production forecasts for 2026 given required operational phasing and shifts to narrower veins.
Silver output for the year ahead is now expected to come in at between 42 and 46.5 moz, down from a previous 45-51 moz. Gold production is now forecast at 500-550 koz, potentially down from a previous 515-565 koz.
Shares in the high-flying FTSE 100 company fell marginally in UK trading having come into this latest news up by more than 500% in the past 12 months. The FTSE 100 rose 21.5% last year, with silver and gold up by 136% and 64% respectively. Fellow precious metals miner Endeavour Mining (LSE:EDV) rose by 172% in 2025.
Factors including raised global geopolitical tensions and elevated government debt have been attracting investors to precious metals in recent years.
Fresnillo operates a series of mines across Mexico. The company is the world's largest primary silver producer and Mexico's biggest gold producer.
The miner’s full-year 2025 silver production of 48.7 moz was 13.5% lower than in 2024. Gold output of 600.3 koz reduced 5%.
Latest and final quarter production for each saw silver production climb 5.9% from the previous quarter, with gold output falling 10.6% from Q3.
Fresnillo’s forecast production quotas for 2027 and 2028 sees both silver and gold output potentially returning to similar levels as in 2025.
Full-year results are scheduled for 3 March.
ii view:
Headquartered in Mexico City, Fresnillo shares are listed both on the Mexico and London Stock Exchanges. Nine Mexican operations include underground mines at Fresnillo, Saucito, Juanicipio and Ciénega, as well as open pit mines at Herradura, Soledad-Dipolos and Noche Buena. Group exploration includes a silver and gold project within the Guanajuato region as well as three other gold exploration projects.
For investors, silver and gold output both fell in 2025 from 2024, with further falls forecast in 2026. A share price-to-net asset value ratio comfortably above the three-year average may suggest the shares are not obviously cheap. A highly focused portfolio of mined commodities heightens risks compared to more diversified rivals like Glencore (LSE:GLEN) and Rio Tinto Ordinary Shares (LSE:RIO), while currency moves between Mexican operations, precious metals priced in dollars and shares traded in pounds also deserves thought.
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On the upside, silver and gold production levels should return to 2025 levels in 2027 and 2028. Factors propelling precious metals include a reduced US appetite to protect and pay for European defence security. Group net cash held of $1.8 billion as of late June points towards a robust balance sheet, while a management focus on improving operational efficiency persists.
In all, a significant rise in the share price over the last year and forecast declines in 2026 output offer grounds for caution. That said, elevated global geopolitical tensions are likely to maintain investor interest in the sector.
Positives:
- Pursing efficiency measures
- Income generation and exposure to precious metals
Negatives:
- Lacks the product and geographical diversity of other miners
- Currency movements can impact
The average rating of stock market analysts:
Hold
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