Johannesburg, South Africa — 06 September 2012 – South Africa is expected to fall down the rankings of the world’s leading gold producers, according to Thomson Reuters GFMS, which has delivered its findings on first half gold industry statistics.
In an article published by Business Day and Reuters, GFMS global head of metals analytics Philip Klapwijk was quoted as saying South Africa would become the world’s sixth largest gold producer from its current number five position in 2012. South Africa is expected to report a 5% reduction in gold output this year from 198t in 2011, Business Day and Reuters said.
Commenting on labour unrest in South Africa, Klapwijk said that investors were more sanguine on the gold sector than the country’s platinum sector. However, gold output interruptions borne of labour unrest would nonetheless create "consternation", the news agencies said.
“Foreign observers are a lot more sanguine about the gold sector than the platinum group metals (PGM) sector for the simple reason that South Africa’s footprint in mining is nothing like it used to be,” Klapwijk added.
“Unfortunately, there’s a general expectation these days about South Africa’s gold mining industry “’ that it’s in a long term decline in production and part of that story is a difficult industrial relations backdrop,” said Klapwijk.
“If foreign investors and observers were to think this could trigger labour unrest and renewed debate about taking mines into public ownership, people would conclude that this would damage security of property rights in South Africa and lead to a far more accelerated decline in output,” he said.
Gold prices were expected to rise to US$1,800/oz before the year-end and could possibly break through US$2,000/oz, GFMS said in its forecast for the remainder of the year.
Source: Miningmx. For more information, click here.