Hochschild output target vs rising AISC: cashflow and project notes for mine planners
Reviewed by Joe Ashwell
First reported on MINING.com
30 Second Briefing
Hochschild Mining is holding its 2026 production guidance of 300,000–328,000 gold-equivalent ounces after Q2 attributable output reached 76,231 oz, taking H1 production to 151,830 oz, despite all-in sustaining costs running 5–10% above the $2,157–$2,320/oz guidance range. CEO Eduardo Landin cited stronger operating cash flow from the Inmaculada and San Jose underground mines and early gains at Mara Rosa in Brazil, where a new mining contractor, shorter haulage distances and improved plant stability are central to the turnaround. The company ended June with about $309 million in cash and short-term investments and a net cash position of roughly $51 million, while preparing a revised EIA for the Royropata project in Peru and an H2 2026 investment decision on Monte Do Carmo in Brazil.
Technical Brief
- Attributable AISC currently exceeds the $2,157–$2,320/oz guidance band by roughly 5–10% due to cost pressures.
- Higher gold and silver prices are directly inflating statutory royalties, workers’ profit sharing and selling expenses.
- Persistently high inflation in Argentina is specifically cited as a driver of elevated unit operating costs.
- At Mara Rosa, operational focus is on accessing higher-grade ore zones and shortening internal haulage distances.
- Improved plant reliability at Mara Rosa is already delivering quarter-on-quarter production gains during the turnaround phase.
- Hochschild ended June with about $309 million in cash and short-term investments and net cash of ~$51 million.
- A revised EIA for the Royropata project will leverage proximity to existing Pallancata/Selene infrastructure in Peru.
- Monte Do Carmo in Brazil is being advanced toward a formal investment decision scheduled for H2 2026.
- For other underground precious metals operators, similar royalty and FX-linked cost escalation is likely at current price levels.
Our Take
Hochschild Mining has featured repeatedly in our recent Latin America coverage, from Peru’s politically exposed gold-silver sector to its role at Argentina’s San José mine, signalling that its multi-jurisdictional footprint (Peru, Argentina, Brazil, Bolivia) is a deliberate hedge against single-country permitting and fiscal risk.
The Carangas project’s PEA-level 10 Moz/y silver profile, when viewed alongside Hochschild’s existing San José and Inmaculada production base, suggests the company is positioning Bolivia as a meaningful third silver pillar rather than a marginal satellite, which could influence how it allocates the US$309 million cash balance and net cash position.
Our database shows Hochschild’s London-listed shares have reacted positively on multiple occasions when 2026 production guidance was reaffirmed despite cost pressure, indicating equity investors are currently prioritising volume and project delivery (Inmaculada, Mara Rosa, Monte do Carmo, Royropata) over short-term AISC variance of 5–10% above guidance.
Prepared by collating external sources, AI-assisted tools, and Geomechanics.io’s proprietary mining database, then reviewed for technical accuracy & edited by our geotechnical team.
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