London-listed Hochschild Mining said on Wednesday that it would suspend operations at its first mining operation, Arcata, and place the mine in care and maintenance in the second quarter.
The company said that the low silver price had left it with no option, but to suspend operations.
An exploration programme and permitting work would continue, along with a regular review of the market conditions for potential restart of operations in the future.
“It has been an excellent operation with an outstanding workforce and supportive communities, but the continuing low silver price over some years and current geological conditions leaves us no option,” said CEO Ignacio Bustamante.
The Arcata precious metals mine, in south-west Peru, started producing in 1964.
In the first half of 2018, the mine produced 1.76-million ounces of silver and 542 000 oz of gold, the equivalent of about 18% of the company’s total attributable output of 9.67-million ounces of silver.