The past year has seen some changes in global gold production rankings, both by country and by company. Edited, expanded and updated version of article recently published on Mineweb.com. To read original click here.
It is interesting to see how the major producers of gold are faring in the grand scheme of things – both nationally and by company, given the continuing lowish gold prices pertaining over the past two to three years. Currently gold is wavering around the $1260 level and while this is perhaps better than its lows of last year, it is much lower than it was a couple of years ago and is now beginning to have an impact on global gold output.
While many assumed that the lower gold prices would lead to an immediate fall in world gold production as miners struggled to remain profitable, it has to be remembered that some major new mines were already under construction having been launched when prices were much higher. Meanwhile marginal operations have been mining higher grades, at the expense of a reduction in longer term mine life, to maintain profitability. Higher grades at a maintained mill throughput level means higher production so we have the anomaly that falling gold prices may actually lead to increased output.
But this all takes time to filter through and we are quite probably seeing peak gold being attained this year. Global production growth has been falling so global gold output only rose by around 2% last year according to the latest analyses, and this year production is expected to remain flat.
While one may sometimes argue with the methodology, and findings, of GFMS’ global gold supply/demand statistics the consultancy’s latest report on gold includes its estimates of the world’s top gold producing nations and companies which are not so controversial and there are some changes in position and outputs which are certainly worth noting.
We last produced a similar listing based on 2012/2013 figures from rival precious metals consultancy, Metals Focus, last May (see: World top 10 gold producers – countries and companies on Mineweb) and while some of the GFMS statistics may vary a little from those of Metals Focus they broadly follow the same pattern and the overall figures are comparable – perhaps not too surprising given that Metals Focus was started by ex GFMS analysts and marketers.
Let’s take the top 10 country-by-country producers first, showing changes in position based on GFMS 2013 figures and 2014 estimates:
Table 1. Top 10 World Gold Producing Countries 2013/2014 (tonnes)
Notably here, according to the GFMS estimates, China has continued to see increased gold output and remains comfortably the World No. 1. But the No.2 position is now occupied by Russia, which appears to have leapfrogged over Australia to attain this ranking with 9% output growth last year. Former World No. 1 for most of the last century, South Africa, is nowadays only in sixth place – and is evenin danger of being overtaken by Canada this year, which has seen particularly strong growth in the past couple of years while South African output continues to slip. Indeed Canada provided the strongest growth (15%) amongst the major producing nations.
Among the top producing companies, there have been some substantial gold output drops from the biggest miners, mainly due to divestments and closures – see table below. While this may mean output has fallen for the two top gold miners, Barrick and Newmont, the divested operations are still producing, but for companies further down the food chain.
Table 2.World Top 10 Gold Miners 2013/2014 (tonnes)
As can be seen, Barrick has recorded the biggest fall, while Newmont is in danger of being surpassed by AngloGold Ashanti as world No. 2 if 2014’s percentage increase and decrease figures are replicated again in the current year. Others which showed good production rises are Goldcorp, Gold Fields and the latter’s South African spinoff Sibanye Gold. Indeed if these two latter miners had remained combined they would together have been comfortably in the world No. 4 slot, well ahead of Goldcorp. The only change in ranking here is that GFMS reckons Uzbekistan’s state mining company, Navoi MMC, with a 4% increase in production, mostly from its massive Muruntau operation, has moved above Australia’s Newcrest, which is estimated to have recorded a small fall in output.
With GFMS now reckoning that the pent-up growth in global gold output may well have peaked last year with the various big, and small, new gold projects in the pipeline having mostly now reached full capacity, we could well see some further production downturns from some of the big miners this year, although their financial positions could be improving regardless given the recent concentration on cutting all-in costs – aided in many cases over the past year by the big fall in oil prices and the strength of the U.S. dollar for production from outside the U.S. itself.