Fitch Solutions recently released a report that shows that the production growth of copper and gold across the globe is set to resume determinedly as the disruptions that have affected mines in the last year are halted. In the period 2012–2025, Fitch expects that the global mine production growth will stay strong as rising prices encourage more output and investments.
The company also predicts that the production of gold across the globe will increase from about 109 million ounces this year to roughly 141 million ounces by the year 2030 at an annual growth rate of 3.2%. According to this analytics company, this indicates an advance in the 0.8% average growth rate recorded in the 2016–2020 period.
The report notes that in the coming decade, the output of gold in China will stagnate after increasing during the last ten years. Additionally, reducing ore grades will curb domestic investment, which will in turn push more Chinese companies to develop projects overseas. Leading Chinese companies are expected to increase their investments in foreign gold mines as the nation’s demand for gold surpasses production.
Major deals in the last few years around the world include the $960 million purchase of a 50% stake in Barrick Gold’s Argentinian Veladero mine by Shandong Gold. Analysts anticipate that the companies will also collaborate on exploration activities in the region. Earlier in 2017, Zijin Mining produced just over a million ounces of gold, which made up roughly 10% of China’s total gold output.
Over in Australia, the gold sector is expected to record a production growth in the near future, which will be backed by competitive operating costs, increasing prices of gold and a robust project pipeline. Fitch predicts that Australia’s gold production will increase to roughly 13 million ounces by 2030 from about 10 million ounces this year. This increase equates to a 2.2% annual growth rate. With regard to copper, Fitch anticipates that the international production of copper will increase by nearly 8% year-on-year as new projects begin.
The company expects the output of copper to remain steady over the medium term as more companies begin expansions and more projects are begun. Fitch also notes that the increasing demand for the red metal and increasing prices will allow it to remain strong. Fitch predicts that the production of copper will also grow by an average rate of 3.7% annually, increasing from roughly 20 million tons last year to about 29 million tons in 2030.
This bullish forecast could spur on mining companies such as Excellon Resources Inc. (TSX: EXN) (NYSE American: EXN) (FSE: E4X2) that currently have precious metals exploration as well as development projects going on at different resource-rich properties.
NOTE TO INVESTORS: The latest news and updates relating to Excellon Resources Inc. (TSX: EXN) (NYSE American: EXN) (FSE: E4X2) are available in the company’s newsroom at https://ibn.fm/EXN
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