Gold miners struggle to sustain output growth amid scarce deposits
TLDR
- Gold mining industry facing challenges in sustaining production growth due to difficulty in discovering new deposits, according to World Gold Council (WGC).
- Despite record first-quarter mine production in 2024 with a 4% year-on-year increase, overall trend shows plateau in gold production since 2016.
- Data from WGC indicates only a 0.5% increase in mine production in 2023 compared to the previous year, following modest growth in previous years and a decline in 2020.
The gold mining industry is facing challenges in sustaining production growth as new deposits of the metal become increasingly difficult to discover, according to the World Gold Council (WGC).
Despite a record first-quarter mine production in 2024, which saw a 4% year-on-year increase, the overall trend shows a plateau in gold production. Data from the WGC indicates that mine production edged up by only 0.5% in 2023 compared to the previous year. This follows a modest growth of 1.35% in 2022, 2.7% in 2021, and a notable decline of 1% in 2020—the first decline in a decade.
In light of these challenges, Africa might emerge as a promising new frontier for gold exploration. With vast unexplored regions and potential untapped reserves, the continent offers significant opportunities for future gold mining ventures. Canada's Montage only recently discovered the largest gold deposit in Ivory Coast.
Key Takeaways
New gold deposits are becoming increasingly difficult to find worldwide as many prospective areas have already been extensively explored. Large-scale gold mining is capital-intensive and requires significant exploration and development, often taking an average of 10 to 20 years before a mine is ready for production. Even during the exploration process, the likelihood of a discovery progressing to mine development is low, with only about 10% of global gold discoveries containing sufficient metal to warrant mining. To date, around 187,000 metric tons of gold have been mined, with the majority coming from China, South Africa, and Australia. Gold reserves that can be excavated are estimated at around 57,000 tonnes.
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