Gold News

South African gold output falls in 2009

Gold Prices in South Africa could rise as its output continues to fall.

According to the latest official figures by the country's Chamber of Mines, 2009 saw a further decline in South African annual gold output to less than 205 tons.

The country was the fourth largest gold miner last year, despite having been the world's biggest source of the yellow metal for most of the previous century.

There was a 5.8 per cent decline in the amount of gold mined in 2009, less than the 14.5 per cent drop the previous year, but large enough to suggest Gold Prices could begin rising if supply continues to drop.

In recent years, South Africa has lost ground in the gold production race as its older mines have been exhausted, with China becoming the world's largest producer since 2006.

The 2009 figures confirm that the US and Australia have also leapfrogged the African country.

However, the Chamber of Mines stated: "The gold mining industry remains critically important to South Africa’s economy."

Commenting on the drop to BusinessDay, mining expert Alan Bird, of consultancy Bain & Company, said: "It is going to be tough for South Africa to get back to its number one position again because the issue for the industry is mainly a geological one.

"What the industry can do at best is to reduce the decline in production."

Bain & Company employs over 3,500 consultants around the world and has 41 offices in 27 countries.

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