Australian gold production hit a record 328t for the 2019-2020 financial year as the price of the precious metal continues to soar amid economic uncertainty.
Data from Melbourne-based gold mining consultants Surbiton Associates showed gold output totalled 85t in the June quarter, a 10% jump over the 77t produced in the March quarter.
The price of the safe-haven asset had surged to $US$1969/oz on August 31 as investors look for security amid the economic turmoil stemming from the Coronavirus pandemic.
The data revealed the 328t of gold produced in Australia in the year to the end of June was worth almost $25b at the average gold price for the financial year.
Surbiton Associates co-director Dr Sandra Close said she could not recall so much interest in gold since the modern boom began almost 40 years ago.
“There is a high level of activity overall, from investment, increased capital raisings and initial public offerings, to greater exploration and drilling and a scramble to peg new ground,” she said.
“Just look at the gold price graphs, the price increases over the last year or 18 months have been extraordinary, both in Australian and US dollars.
“Sadly, this is a reflection of the uncertainty and unrest around the world.”
Dr Close said despite the distress and disruption the coronavirus pandemic continues to cause locally and globally, it has not affected Australian gold production.
However, exploration had been restricted slightly due to travel restrictions.
“The Australian gold sector, like the larger iron ore mining industry, is producing record export quantities and is doing its best to boost our balance of payments,” Dr Close said.
Australia remains the world’s second largest gold producing country after China, according to the United States Geological Survey.
South Africa, which was once the world’s largest gold producer, doesn’t even feature in the top 10 anymore.
There was an 8t increase in gold production in the June quarter compared with the previous quarter with almost all Australian operations increasing output, Dr Close said.
“The largest increases were Cadia East (Newcrest), up 41,500oz, then Jundee (Northern Star) and Boddington (Newmont) both up 26,000oz and Mount Magnet (Ramelius) was up 22,000oz.”
Saracen and Northern Star, which purchased the Super Pit as equal joint ventures near the end of 2019, have recently released updated resource and reserve figures and have also reported that the revised mine life has been extended to the year 2035.
“The latest update on the Super Pit is most encouraging,” Dr Close said.
“After the problems with the large wall slip are resolved by the cut-back now underway, production should return to more usual levels, with Super Pit probably once more joining the list of top five Australian gold producers.”
Australia’s largest gold producers for the 2019-2020 financial year were Newcrest Mining’s Cadia operation with 843,338oz, Newmont Corporation’s Boddington operation with 673,000oz, Kirkland Lake Gold’s Fosterville mine at 664,191oz, Newmont Corp’s Tanami with 495,000oz and the Tropicana joint venture between AngloGold Ashanti and IGO Ltd with 463,556oz.
The March quarter output is usually the lowest in the year because it has fewer days in the period and often has wet weather, while producers also seemed to take advantage of the rising gold price to treat some lower grade stockpiles in the March quarter.
The “pm fix” price of gold hit a record of $US2067/oz on August 6 when the Australian dollar price reached an all-time record of $2868/oz.
Australia also imports considerable amounts of crude gold for refining, which is then exported, thereby increasing the value of total gold exports even further.
Dr Close authored “The Great Gold Renaissance” almost 20 years ago and is currently writing a second book on the Australian gold industry.
