Gold “’ global output
up, SA production
down
 
London, England — MININGREVIEW.COM — 19 January 2010 – South African gold production fell 5% last year as the country slipped into third spot in the world rankings of gold producers behind China and Australia.

Confirming this in a statement issued here, GFMS Metals Consulting “’ which specialises in providing research and consultancy services into the base metals, steel and related sectors “’ said that South Africa “’ the world’s largest producer for nearly a century “’ had been sliding down the global table over the past few years as production declined.

It added that global gold production had risen 6% last year to a six-year high, but South African production had dropped 5% due to a host of problems, including several accidents that necessitated closures, declining ore grades and higher costs.

Analysts have said that “’ coupled with labour problems, lowering grades and the fact that several mines were reaching the end of their lives “’ this meant that South African production was not expected to increase sufficiently in the future for it to regain its top spot.

The statement went on to say that this raised concern that although gold had surged to more than US$1000/oz in recent months, South Africa’s mining companies appeared likely to miss out on the rally due to a decline in production and a stronger rand-dollar exchange rate, which had squeezed margins.

World output was 2 553 tonnes last year, compared with 2 409 tonnes in 2008. South African production was 222 tonnes of gold last year, down from 234 in 2008. South Africa lost its number two position to Australia, which produced 223 tonnes last year, while China produced 330 tonnes, GFMS said.

The consultancy said it expected more investment in the gold market in the first half of this year, which was likely to push gold prices to fresh records.