The world's largest primary silver miner, Mexico's Fresnillo Wednesday announced record silver and gold production during the second quarter of this year.

Second-quarter 2010 silver production was reported at 9,615,000 ounces, up .03% from 9,587,000 for the second-quarter 2009 while quarterly gold production achieved a 33.9% increase from 68,166 ounces to 91.254 ounces.

First half silver production was reported at a record 19.1 million ounces, up 1.6% from 18,805,000 ounces for the same period of 2009.

Gold production also jumped 32.7% during the first half of this year from 132,894 ounces to 176,351 ounces.

Attributable gold production in the second quarter received a significant boost from the beginning of commercial production at the Soledad-
Dipolos project and higher ore grades at the Ciénega mine, both located in Mexico.

Eoin Treacy's view Silver has been a laggard when compared to gold over the last year and continues to hold below the psychological $20 level. There have a number of downward dynamics, evident on the daily chart, which suggests some aggressive liquidation of long positions following relatively modest advances. Despite this, prices have continually found support in the region of the 200-day MA since late 2008 and would need to sustain a move below that mean to indicate supply is regaining the upper hand. Given silver's considerable price volatility it is invariably best bought following reactions.

Fresnillo successfully broke upwards from its 8-month range in June, found support above 900p last week and moved to a new closing high yesterday. A sustained move back below 950p would now be required to begin to question the consistency of the medium-term uptrend.

For further reading on silver the 245-page report posted in Comment of the Day on February 23rd may be of interest.