Silver Market Dynamics & Growth Strategies in Current Bull Cycle

• Capital access has improved significantly, with both Vizsla Silver and Endeavour Silver successfully raising over $100 million each and seeing expanded US investor participation, indicating renewed institutional interest in silver equities.
• Silver is approaching $40 with the gold-silver ratio at 88:1, presenting an opportunity for silver outperformance driven by both industrial demand and monetary uncertainty in global markets.
• Endeavour Silver is scaling operations from 8 million to 20 million silver equivalent ounces by 2026 through new production and acquisitions, while Vizsla progresses toward 20 million ounce annual production capacity.
• Mexico remains the primary jurisdiction for quality silver assets, with an improved permitting environment under President Claudia Scheinbaum creating more favorable conditions for mining development.
• Recent acquisitions of major Mexican silver producers including Silvercrest, Gatos, and MAG Silver are reducing available assets and creating a scarcity premium for remaining independent producers.

Vizsla Silver, led by President & CEO Michael Konnert, is developing Mexico's next tier-one silver deposit at the Panuco project in Sinaloa. The company has progressed rapidly from exploration to development stage, currently operating a test mining operation while advancing through feasibility studies and environmental permitting. With over $200 million in cash following a recent $100 million financing, Vizsla is positioned to become what it projects will be the world's largest single-asset primary silver producer, targeting 20 million silver equivalent ounces annually upon reaching full production by 2027.

Endeavour Silver, under CEO Dan Dickson's leadership, operates as an established mid-tier silver producer with assets primarily in Mexico and a recently acquired operation in Peru. The company produced approximately 8 million silver equivalent ounces in 2024 and is executing a growth strategy to reach 20 million ounces by 2026. This expansion centers on commissioning the Terronera project in Mexico and integrating the Minera Kolpa acquisition in Peru, positioning Endeavour to transition from a mid-tier to senior silver producer with diversified jurisdictional exposure.

Both companies represent different stages of the silver mining lifecycle - Vizsla as an advanced developer approaching production and Endeavour as an operating producer executing aggressive growth plans - providing distinct investment profiles within the consolidating silver sector.

Market Dynamics & Investor Interest

The silver mining sector has experienced renewed investor attention as metal prices trend higher. Michael Konnert of Vizsla Silver, noted the changing investor landscape:

"We were able to access an investor group that we had been introducing ourselves and marketing to over the last several years. But we were very pleased with this kind of new breed of investor that was coming to our story."

Both companies successfully raised substantial capital in 2025, with Vizsla completing a $100 million bought deal and Endeavour securing funding for acquisitions. The funding sources reflected a shift in investor composition, with increased participation from US-based institutional investors. Dan Dickson, CEO of Endeavour Silver, explained the evolution:

"Our investors right now are probably a bit more focused on cash flow and then the growth inside that cash flow. Ultimately, precious metal funds are investing more in silver, moving from gold into silver."

The improved access to capital coincides with silver's technical setup relative to gold. At current levels, the gold-silver ratio sits at approximately 88:1, well above the historical average of 65:1. Konnert emphasized this opportunity:

"Seasoned investors know that when that happens, the silver moves can be explosives and the silver equities can absolutely outperform their gold counterparts."

Panel with Michael Konnert, President & CEO of Vizsla Silver, and Dan Dickson, CEO of Endeavour Silver

Geopolitical Factors & Silver Positioning

Silver's dual nature as both an industrial and monetary metal positions it uniquely in the current geopolitical environment. Konnert described this dynamic:

"Silver does sit at this crossroads of industrial growth and monetary anxiety. And we're seeing that play out with the gold price, silver starting to catch up with gold."

The relationship between the United States and Mexico, a critical silver-producing jurisdiction, has shown improvement under President Claudia Scheinbaum's administration. Both CEOs noted more constructive engagement from Mexican authorities regarding mining permits and operations. Dickson observed:

"I think Claudia Sheinbaum, the President of Mexico, has done a very good job of communicating to her population and ultimately negotiating with the United States and trying to stay calm and do that."

Mexico's position as the world's largest silver producer, combined with free trade agreements between North American countries, provides stability for mining operations. The improved permitting environment represents a significant change from previous administrations, with Konnert noting:

"Countries are thinking about, well, we need to actually permit mines, we need to move these projects forward."

Operational Strategies & Production Growth

Endeavour Silver's operational strategy centers on scaling production through organic growth and strategic acquisitions. The company expects to increase annual production from 8 million silver equivalent ounces in 2024 to 20 million ounces by 2026, primarily through commissioning the Terronera project in Mexico and integrating the recently acquired Minera Kolpa operation in Peru.

Dickson detailed the integration process:

"The integration has gone extremely well, extremely smoothly. We're excited about the team that we operated in. They've operated as a silo. We can bring some expertise that we've done."

The acquisition provided Endeavour with a producing 5 million silver equivalent ounce asset and established operations in Peru, creating opportunities for further growth in that jurisdiction.

Vizsla Silver approaches production differently, having advanced rapidly from exploration to development. The company currently operates a test mine at its Panuco project in Mexico while progressing through feasibility studies and permitting for full-scale production. Konnert explained the timeline:

"We expect to be starting construction by the midpoint of next year. That would be basically the end of second half of and being in a position to produce first silver at the end of 2027."

Risk Management & Financial Positioning

Both companies maintain conservative financial approaches despite growth ambitions. Endeavour's strategy includes managing debt levels carefully while financing expansion. Dickson emphasized the importance of balance sheet management:

"As a mining company and the volatility in our space, in the mining space and more in the silver space, I try to stay as little on debt as possible."

The company implemented hedging strategies for its Terronera project, including gold hedges while avoiding silver hedging to maintain upside exposure. Dickson explained: "We're trying to stay away from any silver hedging. We did put in some callers as we creeped into the end of commissioning here."

Vizsla's financial position improved significantly with recent fundraising, bringing cash on hand to over $200 million. This funding provides flexibility for construction and eliminates near-term financing concerns. Konnert noted:

"We're really well funded. We just raised $100 million recently in a bought deal that brings our cash on hand to north of $200 million US."

Market Consolidation & Asset Scarcity

The silver mining sector has experienced significant consolidation, with major Mexican producers being acquired by larger companies. This trend has reduced the number of available quality silver assets, creating potential valuation premiums for remaining independent producers.

Dickson highlighted the sector's limited options:

"In the primary silver space, you've got Pan-American silver and they're only 25, 30% silver with the acquisition of MAG. Coeur and Hecla out of the United States, First Majestic here in Vancouver like Michael and I. And then what do you have? It's Endeavour Silver as the next one there."

The scarcity extends to jurisdictions capable of supporting profitable silver mining operations. Both CEOs emphasized that high-quality silver deposits primarily exist in Mexico and Peru, limiting options for companies seeking growth opportunities. Konnert observed:

"There's really one or two - Peru and Mexico. I'd say Mexico, of course, is the main one there. It's the number one producer of silver in the world."

Development Timelines & Execution Risk

Vizsla's progression from discovery to near-production represents an accelerated timeline in mining development. The company consolidated the Panuco district in 2019 and expects to reach production by 2027, significantly faster than industry averages.

Konnert attributed this pace to several factors:

"Mexico gets a lot of knocks, right? But on average in Mexico, the amount of time it takes to go from discovery to production is about eight and a half years."

The company benefited from existing infrastructure, year-round drilling capability, and favorable geological conditions.

The technical team's experience proved crucial in execution. Chief Operating Officer Simon Smirlik's background includes building 45 mines globally, providing expertise for the construction phase. Konnert emphasized this advantage: "Simon our COO, has built 45 mines all over the world."

Industry Challenges & Future Outlook

Both CEOs acknowledged the inherent challenges in mining development and operations. The sector requires substantial capital, technical expertise, and favorable commodity prices for success. Dickson noted the reality of mining ventures: "For every successful one, there's 15 that are unsuccessful, probably higher than that."

Workforce development presents ongoing challenges, with gaps in experienced personnel between senior and mid-career professionals. Dickson identified this concern: "In our space, it's still a graying workforce. There's a gap between the 65-year-old range and the 45 to 50-year-old range."

The companies expect continued strong silver fundamentals based on industrial demand growth and monetary factors. At current silver prices near $40, margins for producers improve significantly, with typical all-in sustaining costs approaching $20 per ounce.

The Investment Thesis for Silver

• Supply Scarcity: Limited number of quality primary silver deposits globally, with recent consolidation reducing available public investment options
• Production Growth: Leading companies scaling operations significantly, with Endeavour targeting 150% production increase by 2026 and Vizsla approaching first production
• Valuation Opportunity: Silver trading at historic discount to gold despite improving fundamentals and industrial demand growth
• Jurisdictional Advantages: Mexico's improved permitting environment and established mining infrastructure supporting development timelines
• Margin Expansion: Current silver prices near $40 providing substantial margins over typical $20 all-in sustaining costs
• Institutional Interest: Renewed fund participation and capital access indicating institutional recognition of silver's strategic value
• Technical Setup: Gold-silver ratio above historical averages suggesting potential for silver outperformance during precious metals bull market

The silver mining sector presents compelling investment opportunities as metal prices strengthen and leading companies execute growth strategies. Market consolidation has reduced available assets while demand fundamentals remain supportive from both industrial and monetary perspectives. Companies with established operations, strong balance sheets, and growth pipelines appear well-positioned to capitalize on the improving silver market dynamics.

Macro Thematic Analysis: Silver's Strategic Position in Global Markets

Silver's current market position reflects broader macroeconomic themes driving precious metals demand. The metal's dual role as both an industrial commodity and monetary asset creates unique dynamics in the current environment.

Industrial demand continues growing through technology applications, renewable energy infrastructure, and manufacturing processes requiring silver's conductive properties. This demand base provides fundamental support independent of monetary considerations.

Simultaneously, monetary uncertainty stemming from geopolitical tensions, currency debasement concerns, and inflation expectations drives precious metals demand. Central bank gold purchases have reached record levels, with silver historically following gold's directional moves while offering greater volatility and potential returns.

The gold-silver ratio at 88:1 suggests silver remains undervalued relative to gold's recent performance. Historical patterns indicate silver tends to outperform during precious metals bull markets, particularly when the ratio exceeds long-term averages.

Supply constraints add another supportive factor. Primary silver mines represent only 30% of global production, with the remainder coming as byproduct from base metal operations. This structure limits supply responsiveness to price increases and creates potential shortages during demand growth periods.

North American trade relationships, particularly between the US and Mexico, influence silver market dynamics. Mexico's position as the world's largest silver producer, combined with improving regulatory environments, supports continued production growth from established mining districts.