Hochschild Mining PLC (LON:HOC) has suspended operations at its Arcata precious metal mine in south-west Peru, saying a low silver price had left it no choice but to halt production.
The FTSE 250-listed gold and silver miner, which operates three mines in southern Peru and one in southern Argentina, said the mine would be on "full care and maintenance" status by the second quarter of 2019.
READ: Hochschild's debt situation improves, paving way for hefty dividend hike
In a statement, Hochschild’s chief executive officer, Ignacio Bustamante said: “This decision has been expected but is still disappointing for the organisation ... but the continuing low silver price over some years and current geological conditions leave us no option."
He added that the company would work closely with its employees and contractors to mitigate the impact in a staged shutdown of operations.
The company said it would continue to do exploration work at Arcata, the company's first mining operation dating back to 1964, and would regularly review market conditions for a potential restart of operations in the future.
Silver prices averaged about US$15.7 an ounce in 2018, well below its record level of US$49.5 an ounce hit in 2011.