On the banks of the Madre de Dios River, dredges tirelessly scour the water in pursuit of gold, emblematic of the illegal mining crisis that is steadily consuming the Peruvian Amazon.
This biodiverse region in southeast Peru has been losing an average of 21,000 hectares (52,000 acres) of rainforest annually since 2017, despite government enforcement efforts that locals deem inadequate. Once lush with trees, the landscape is now marred by deep sinkholes filled with murky water where dredges sift through heaps of rubble for precious metal.
“The community can no longer plant their corn, their bananas, their cassava, because this land is practically dead,” said Jaime Vargas, a 47-year-old Shipibo Indigenous leader and reforestation activist.
Despite mining being prohibited in their territories, Indigenous people are forced to coexist with the encroaching gold prospectors in Madre de Dios, a department home to about 180,000 people near the borders of Brazil and Bolivia. Some Indigenous individuals even end up working for the miners.
The international gold price surge, reaching an all-time high in May, has intensified the hunt for gold in Peru, the world’s tenth-largest producer and second in Latin America, according to the US Geological Survey.
‘No Production Record’
Illegal gold mining operates alongside legal, government-regulated extraction, significantly funding organized crime in regions like La Pampa, a notorious enclave in Madre de Dios.
“Illegal miners are invading us from all sides,” said Lucio Quispe, 40, a local resident. Quispe and his two brothers manage a 200-hectare state-granted concession. Hours before the interview, his brothers were attacked by machete-wielding men in a violent clash over mining territory.
Since 2016, there has been an effort to issue licenses to informal but sanctioned miners like the Quispes. In 2022, Peru officially produced 96 tons of gold but exported approximately 180 tons to countries including Canada, India, Switzerland, and the United States.
“Forty-five percent of exports have no production record,” reported an official body overseeing Peruvian banks and combating money laundering.
Studies identify Peru as the leading exporter of illegal gold in South America, with 44 percent of the total, surpassing Colombia’s 25 percent and Bolivia’s 12 percent, according to the Peruvian Institute of Economics.
‘Sacrificing the Forest’
In an effort to control the issue and protect nature reserves, Peru in 2010 designated a 5,000 square kilometer (1,930 square miles) corridor in Madre de Dios where informal miners can operate until the end of this year. However, of the 9,000 informal miners registered by the 2019 cutoff date, only about 200 have obtained a license, according to Augusto Villegas, the regional director of energy and mines for Madre de Dios.
Within the corridor, dredging 100 cubic meters of soil yields about 10 to 15 grams (0.35 to 0.53 ounces) of alluvial gold, currently valued at around $63 per gram.
“You can’t make an omelette without breaking eggs; you can’t mine in Madre de Dios without sacrificing the forest,” said Villegas.
Despite an international agreement to reduce mercury use and a 2015 import ban, many miners still use the toxic substance to separate gold from sediment. With the price of mercury soaring, some small-scale miners have turned to “ecological gold.”
Lucila Huanco, 54, ceased using mercury three years ago on her 3,000-hectare concession, adopting a gravitational technique to extract gold instead. Initially, her gold fetched a lower price due to its different appearance, but she eventually secured a buyer in Lima who pays about $70 per gram.
“Honestly,” said Huanco, “I don’t want us to be known as polluters anymore.”
Dailygoldprice provides you with live gold prices so that you can always understand the changes in the price of gold and better invest in gold.