Mining production down 1.8% y/y in September, led by lower gold output

Date: Nov 9, 2018

Mining production decreased by 1.8% year-on-year in September, with the largest negative contributor being gold production with a decline of 19% and contributing -3.1 percentage points.

The largest positive contributor was platinum-group metals (PGMs), which had a 7.2% production increase, contributing 1.7 percentage points.

Seasonally adjusted mining production increased by 1.2% month-on-month in September, which followed month-on-month changes of 1% in August and -8.6% in July.

Seasonally adjusted mining production decreased by 2.2% in the third quarter, compared with the second quarter. Iron-ore was the largest negative contributor, with a decline of 13% in production, contributing -1.8 percentage points.

During the third quarter, PGMs had a decrease of 7.4%, contributing -1.8 percentage points.

Investec commented South Africa’s mining sector continued to face numerous challenges, including access to and escalating costs of fundamental inputs, notably mounting electricity fees.

“Hopefully, the recently gazetted Mining Charter 3 will create a degree of regulatory and policy certainty and will, in turn, attract much needed investment into this significant sector of the economy.”

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