Despite the global coronavirus pandemic and its effects, the Australian mining sector has pushed on. In this year’s second quarter, April through June, miners in Australia yielded 95 tons of gold. This was a 10% growth from the first quarter output of 77 tons. However, in the third quarter of the year, the output of gold decreased to 81 tons, a four-ton decline from the quarter. The decline was mainly a result of lower output in some of the biggest gold mines in the country.
Mining consultant firm Surbiton Associates, which specializes in gold, believes that despite this decline in output, the cumulative gold production of this year may be end up exceeding 2019’s record. Firm director Sandra Close explains that despite the decreased production in the year’s third quarter, the value of output of mined gold in Australia has not been affected.
Close said that during the third quarter, gold production in Australia was based on the average gold price in Australia, valued at more than $7 billion. This, she stated, is equal to nearly $28 billion yearly. She added that the last quarter of the year, i.e. December, had the highest output, which would bring total production of the year to nearly 326 tons or exceed last year’s record. Output of gold for the period between January to September comes down to a total of 244 tons.
In the third quarter of the year, the Australian dollar averaged at US$0.73 with the average price of gold being AU$2,680/ounce in the same period. Additionally, the weighted average cost of manufacturing (cash) was lower than half the gold price average. This shows that a majority of producers of gold raked in very good profit margins. However, sustaining costs and weighted average cash costs increased because fewer ounces of gold were produced.
The largest mines in Australia all recorded declines in their September outputs, with the Fosterville mine, located in Victoria, producing 161,498 ounces. Western Australia’s Boddington mine produced 178,000 ounces, and the New South Wales Cadia East operation produced 196,504 ounces.
Close explained that a shortage of workers in the natural resource industry in Western Australia because of border constraints may have affected output as well. She stated that a lot of job opportunities exist in various support roles, professions and even in the trades. However, contractors in various sectors are having a hard time finding people to fill these positions.
Elsewhere, Josemaria Resources Corp. (TSX: JOSE) (OTCQB: JOSMF) is pressing ahead with developing its flagship gold and copper extraction project found in San Juan, Argentina.
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