What is ahead for the commodity
Interview: Coeur D'Alene Mines---Wheeler, Dennis---Chairperson of the Board
>> silver price rose above $7 an ounce for the first time in six years. the rise as investors speculated that the metal used in electronics and photography may catch up with the games made -- gains by gold and copper recently. couer daline is the largest silver producer. dennis miller is chairman and chief executive. he joins us from our chicago bureau with a look at what is ahead for the commodity and his company. let me ask you first what is ahead for the commodity. how high can prices go?
>> well, we have been suggesting that silver prices could reach $7. but we felt it was necessary to be at $8 level. we don’t a habit to forecast prices. i think the fundamentals are there for it to happen.
>> we have seen gold and copper rise quite a bit, copper particularly on demand for building materials. what is driving demand for silver right now?
>> a strong industrial demand. i think encouragement that the economy is indeed recovering. silver is the most widely used metal. there’s use in the technology area, electronics, medical fields where, for example, you have silver catheters, silver used to kill bacteria, new silver bandages are being introduced in to the marketplace and clean water applications. really an unlimited number of new uses that are quite exciting.
>> we hear a lot about demand from china for copper. what about for silver?
>> we expect that the demand in silver will grow about 12% this coming year in china. clearly china, india and south korea are key marketplaces for us. and, you know, they are just beginning to industrialize their economies. people want the types of silver- based items like cell phones, television sets, etc. that we have here and we’re excited about that marketplace.
>> china had been selling a lot of silver. they have recently stopped. but if they go back into the market , would that have a major effect on prices?
>> it could have. clearly two to three years ago they had a marked impact of silver exports. but we think the strength they’re showing now has had an impact favorably on prices. we think it reflects their own internal needs for silver.
>> one thing people are concerned about in terms of silver is the photography area. kodak is getting out of the still photography, film area in large measure to concentrate on digital photography. how is that going to affect your business, your company?
>> well, kodak’s announcement really said they were not going to devote substantial efforts to research because they had a mature product line. actually if you look at the growth in photography, there is still minimal growth taking place worldwide in photography which really represents only about a quarter of the total industrial sector. so we feel that the growth in print paper, for example, the digital users are experiencing, is healthy for the photographic sector and that the growth in china, india and the other asian areas will offset the decline in the united states in photographic-related consumption.
>> before we let you go, sreu to ask you about the outlook for your company.
>> well, we are the largest primary silver producer. we do not head silver. our shareholders have had the benefit of the volatility in the metal and our complete leverage of sill prices. we have seen a good movement in our share price over this last year for our shareholders. we expect to expand our production and continue to work on lower costs, increase cash flows. we think this is going to benefit our shareholders and we expect that the company is going to have a good year in 2004.
>> all right. thank you very much. dennis wheeler. after cutting costs and forecasting annual profits next year, ford and chrysler say they’ll be rewarding executives. we’ll have details, next.
