High Gold Prices Spark Peruvian Gold Rush


"Nowhere on the continent is as much gold mined as in Peru."

A rise in global demand for gold has sparked a hectic search for the precious metal in Peru's rainforests. Indigenous people and adventurers from all over the world are digging up riverbanks in the region—with dire consequences for the environment.

Francisca Hualla is a highland Indian. Her face is tanned a deep bronze and her hands are raw and cracked. Resting in them—a large lump of pure gold wrapped in newspaper.

Hualla walks purposefully into an Inversur Company branch in Huepetuhe, an elongated collection of wooden shacks in the Peruvian rainforest. She is a regular customer. Hualla unwraps her fist-sized treasure and, speaking in broken Spanish, asks how much it's worth. Her native language is Quechua, the dialect of the Incas.

The employee turns the computer around to show her the current LME gold price. On this particular day, a gram of gold is worth 104 soles, or ~US$35. "865 grams," he says, "a little more than $30,000." The sum represents Hualla's earnings for the month, after four weeks of hard digging in her mine.

Hualla has been prospecting along the Río Madre de Dios, the River of the Mother of God, for 25 years. But, in the last three years, she has earned more than ever before. "The price of gold has never been this high," she says.

The Quechua Indian is a crisis profiteer. Demand has triggered a new gold rush in South America. Tens of thousands of fortune hunters now prospect for "pepitas" (gold nuggets) between the Andes and the Amazon. And nowhere on the continent is as much gold mined as in Peru.

Suffering from the onslaught of people, the rainforest is—a brownish-yellow lunar landscape replacing once-lush forests. Mud pools and piles of slag stretch to the horizon. The natural environment has been all but destroyed.

Related Articles

Get Our Streetwise Reports Newsletter Free

A valid email address is required to subscribe