Mexico’s ever-expanding gold mining industry is expected to note a substantial production increase in 2010, adding 880,000 ounces to nearly 2.5 million ounces. The increase will most likely be attributed to several mines, like Penasquito, Pinos Altos and Coeur d’Alene, reaching full production status.

According to Commodities Online, 2010's positive gold projections in Mexico are also supported by several recent mergers and acquisitions among Mexico’s small gold producers, who are apparently on a quest to maximize gold output in light of the surge in gold prices.

According to the report, gold industry experts suggest that the recent flurry of activity in the Mexican gold industry has to do with more than just a bullion-hungry market, and can also be attributed to growing interest by US gold producers and explorers, who are increasingly viewing Mexico as the optimum mining location.

Jeffrey Christian, Managing Director of the New York-based CPM Group, a leading commodities research firm, told Commodities Online that Mexico offers foreign investors a level playing field, along with pro-business mining legislation and a streamlined process for acquiring mining permits.

Mexico, he added, is also home to a good number of near-surface (inexpensive to mine) open pit gold deposits, which gold mining juniors find appealing.