To purchase this space contact Gordon

Surbiton Associates director Sandra Close believes Australia’s gold production in 2020 may surpass last year’s record results despite output dropping in the September quarter.

Gold output in the September 2020 quarter was 81 tonnes, marking a four-tonne decrease from the June 2020 quarter.

Surbiton Associates stated this was due to lower production at some of the largest gold mines in Australia.

However, the value of Australia’s output of mined gold has not been fazed by the lower production in the September quarter, Close said.

“Australian gold production was worth a little over $7 billion at the average Australian gold price for the three-month September quarter. That is equivalent to around $28 billion a year,” she said.

Close said the December quarter usually has the highest production of the year, which could see full year production be close to or surpass the 326-tonne record from 2019.

“For the January to September period in 2020, Australian gold production totalled around 244 tonnes,” she said.

“So output for the full 2020 year should be close to, or may even exceed, the record of 326 tonnes set in 2019. Often the December quarter has the highest production of the year.”

According to Close, the gold price average was $2680 per ounce in the September quarter with the Australian dollar averaging 73 US cents in the same period.

“The weighted average cash cost of production was less than half the average gold price, indicating that many gold producers have enjoyed healthy profit margins, Close said.

“However, because fewer ounces were produced, weighted average cash costs and all In sustaining costs (AISC) rose.”

Australia’s top producing mines for the September 2020 quarter were all down from their June 2020 quarter figures, including Newcrest Mining’s Cadia East operation in New South Wales at 196,504 ounces; Newmont’s Boddington mine in Western Australia at 178,000 ounces and Kirkland Lake Gold’s Fosterville mine in Victoria at 161,498 ounces.

Close also flagged a shortage of mining industry workers in Western Australia due to border constraints.

“…There are plenty of job opportunities, whether it is in the trades, the professions or a wide range of support roles. For example, drilling contractors are flat out and having trouble getting staff such as drillers and particularly drillers’ off-siders,” she said.