I recently wrote that Coeur d'Alene Mines (CDE 0.23%) shares will find themselves under increased pressure should silver prices trade close to the $19 mark. In fact, the pressure intensified, and Coeur d'Alene Mines shares tested new multiyear lows on growing concerns about the company's prospects in a deteriorating price environment. The company also recently stated that it was putting its Joaquin project in Argentina on hold, further undermining growth prospects.

Waiting for better times in Argentina
Coeur d'Alene Mines currently has two main projects -- Joaquin in Argentina and La Preciosa in Mexico. Currently, Joaquin' s estimated measured and indicated resources are 65 million ounces of silver and 60,000 ounces of gold. La Preciosa is bigger, with 126 million ounces of silver and 230,000 ounces of gold.

Coeur d'Alene Mines stated that its decision was based on the fact that it was difficult to move capital in and out of the country because of capital control rules. Difficulties in Argentina have already prompted another silver miner, Silver Standard Resources (NASDAQ: SSRI), to diversify into gold and buy a mine in the U.S. Prior to this transaction, Silver Standard Resources' only producing mine was situated in Argentina.

However, there are companies that show optimism over Argentina despite difficulties with capital flow and big inflation. For example, Pan American Silver (PAAS 0.85%) expects that Argentina will lift its ban on open-pit mining this year. Should this happen, it will open the way for Pan American Silver's Navidad project, which was stalled because of the ban.

Given the current situation, Coeur d'Alene Mines will likely wait for a significant improvement in the Argentinian business environment. While the country's big inflation could have a lowering effect on costs, problems with capital flow offset this benefit.

Cash cushion is big enough to weather the storm
Coeur d'Alene Mines expects to complete the feasibility study on the La Preciosa project in mid-2014. However, given the current price environment, it seems unlikely that Coeur d'Alene Mines will choose to proceed with the project this year. The current silver price could lead to negative operating cash flow, and the company needs to preserve its balance sheet in order to weather current price weakness.

With $273 million of cash on the balance sheet at the end of the first quarter and a maximum of $80 million in planned capital spending this year, Coeur d'Alene Mines has the necessary cushion to wait for pricing improvements. It does not look like the pause in growth projects changes the outlook for the company. There's little need to hurry production in the current price environment.

Meanwhile, Coeur d'Alene Mines shares are getting cheaper and cheaper. Surely, investors are concentrated on the company's relatively high costs, which make it vulnerable to current silver price downside. In addition, Coeur d'Alene Mines is unlikely to demonstrate meaningful production growth this year. However, all these factors are likely to be already reflected in Coeur d'Alene Mines' share price.

Bottom line
Coeur d'Alene Mines shares have been punished hard and are down 37% year to date. Although the company's business is not in the best shape, it's not in shambles either. Low debt and a solid cash position protect Coeur d'Alene Mines from the current pricing problems. Thus, the company's shares are likely to find their support soon.