If an investor doesn’t know that investing in commodities is a risk/return nightmare, they should learn about it quickly before getting into the game. Pricing and commodities can go their separate ways very quickly – and at the drop of a hat. Getting into the mining game is much the same. Place a large bet up front and hope the mine comes in. It isn’t the easiest game to play with a bad ticker, but if the right commodity comes along, the rewards can be staggering.
Sterling Mining Co., an exploration and extraction/initial processor of silver ore, works to extract silver from its Northern Idaho Sunshine mine claim. The claim was reopened in 2007 and is currently extracting solid reserves of silver concentrate at reasonable depths. Although the overall Sunshine claim has been working for some time, the company is working through typical start-up issues as it begins operations.
The company has restructured operations recently and is now seeing production resume at acceptable levels. Bridge financing has been put in place so the facility can continue production with equipment presently onsite. The company is also moving forward with two properties in Mexico. Its rights are extended to one of Mexico’s most historically active silver mining regions. Initial testing indicates that the property continues to hold possibilities.
The reopening of the company’s Sunshine mine is based on the recent run-up in commodity prices. It also has quite a bit to do with silver’s pricing history and its potential in the future. Many in the silver trade feel that electronics and other end-applications that use silver will remain stable or increase in coming years. As silver is a finite supply still in-ground, pricing should technically increase.
Silver’s price has been stable at approximately $5 per/oz. for 30 years. That is, until quite recently. Now, with an approximate price of $18 per/oz., mining is profitable again. In its heyday, Sunshine silver was one of the standard silver bar manufacturers. It appears that this mine is not played out and is ready to resume its position as a leader in the silver mining game.
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