r/SilverSqueeze

Over the past several months I've been digging into the unusual activity in silver and broader precious metals markets: the vault drains, the record delivery volumes, and the price volatility, in an effort to figure out whether there's a real story here or just noise.
What I found is a pattern that, at least to me, looks like more than coincidence: a growing overlap between what's happening in these markets and the major government initiatives now underway around critical minerals.

This post lays out that connection. None of this should be taken as investment advice: just my own research and my own theory, which I'm putting out there for others to poke holes in, add to, or shoot down entirely. Take it for what it's worth and please do your own digging before drawing any conclusions.

Views are my own and not in any way endorsed by my employer. Our firm is neither involved in, nor positioned in, any of the securities or companies mentioned. None of the information in this post, or elsewhere on my page, should at any point ever be misconstrued as neither investment nor financial advice. Please be sure to do your own research, always.

See for yourself here: https://docs.google.com/document/d/1uDROwpDlUvp398tvEWmgn9laHn2pbKgb0vpH05KB6mc/edit?usp=sharing

Version with images (no Imgur links): https://docs.google.com/document/d/1Oj-v5Ik\_JkM\_ZP7QP3mpB9lLKAvrkDN8THm8JeQzIu0/edit

Everyone's been focused on the production ramp and the mill expansion, which fair enough, the Q1 numbers were strong. But there's a second story building at SM that I don't think the market has even started to price in yet.

In H2 2026 they're planning a 30,000 metre drill program into the East District of the Guitarra property in Estado de Mexico. This is ground with over 39 kilometres of historically mapped colonial-era structures, documented silver production going back centuries, and zero comprehensive modern drill campaigns ever completed on it. The company calls it the last of the six major Spanish colonial silver production centres in Mexico not yet systematically explored with modern methods. That's not marketing language. That's actually what the situation is.

The colonial miners found the shallow oxidized ore, went as deep as their methods allowed, and moved on. What they left wasn't depleted ground. It was the deeper portions of the same vein systems and adjacent structures they had no way of seeing. First Majestic found an entirely new high grade system called Navidad beneath their already operating Ermitaño mine in 2024, intercepts returning over 427 g/t silver past 1,100 metres depth. Sitting there the whole time. Modern LiDAR, IP geophysics, and 3D modelling changed what you can find in these belts and Mexico keeps delivering when you apply them to historically productive ground.

The part I keep coming back to is the infrastructure angle. SM isn't an explorer trying to justify a future mine. They're a producer with a mill being actively expanded. Q1 revenues of $10.1 million, more than double Q1 2025. Cash from operations $3.5 million vs $729K a year ago. If the drill program returns something meaningful, it doesn't need its own mine. It plugs into what's already there and being paid for by the existing operation.

Came across a solid breakdown on more of the above, the Mexico silver belt context and what SM is sitting on with the East Disctrict: https://open.substack.com/pub/criticalmineralsstocks/p/mexicos-silver-belt-has-been-hiding

That's a different kind of risk/reward than a pure explorer. Worth watching closely when the H2 results start coming in.