LAWRIE WILLIAMS: Australian annual gold output 317 tonnes – Surbiton

It is always a contentious point as to whether Australia or Russia is indeed the world’s second largest annual gold producer.  The figures are extremely close and not helped by the fact that Australia assesses its annual output from June to June, whereas Russia’s is usually assessed on a calendar year basis,  Indeed the latest figures from London consultancy, Metals Focus, definitely put Russia in second place behind China with 2021 gold output at around 331 tonnes, while the latest figures from Australian specialist gold consultancy, Surbiton Associates, would appear to confirm this putting Australia’s annual gold production in the latest 12-month period at 317 tonnes.  However, Surbiton puts Australia’s June quarter figure at 83 tonnes, which would suggest an annual production rate of 332 tonnes, which if maintained for a full year could put Australia back in second place, particularly if Russian output is affected adversely by the ongoing sanctions programme.

We have always taken Surbiton’s figures for Australian gold output as being extremely accurate, given its on-the-spot analysis and access to the individual Australian mining company figures.  “The industry treated about five million tonnes more ore in the latest quarter than in the previous three month period,” said Dr Sandra Close, a Surbiton director in the consultnacy’s latest press release. “Producers seem to have taken the opportunity to end the financial year on a high note, by pushing their treatment plants a little harder and treating higher grade ore.”

“The increase in total June quarter output came about in spite of continuing problems with the shortage of skilled workers and absenteeism resulting from COVID-19 infections.” Dr Close noted however that input costs are rising, leading to higher costs throughout the industry.

“Once again Australian gold producers benefitted from a weaker Australian dollar compared with the US dollar in the June quarter.”  she commented – a point we made in a previous article on the gold price often advancing in other key currencies, although apparently falling in U.S. dollar terms.

“Local investors should always take note of the gold price in Australian dollars because producers’ costs are mostly in Australian dollars,” Dr Close said. “In the second quarter of 2022, the US dollar price of gold fell by US$125 per ounce but the Australian dollar gold price actually rose by almost A$42 an ounce due to a US 6 cent movement in the exchange rate.”

For those seeking more detail on Australia’s gold industry, Surbiton Associates has just released its second book on gold titled Australia’s Greatest Gold Boom. This covers developments in the Australian gold mining industry from 2001 to 2021. It is the sequel to the first book, The Great Gold Renaissance which covered the previous 20-years and explained the reasons why Australian gold production rose from less than 20 tonnes of gold in 1981 to more than 314 tonnes by 1998. Together the books cover a wide range of aspects of the industry and the people involved over a 40-year period.

“Australia’s Greatest Gold Boom” has taken over three years to research and write,” Dr Close said. “Australia’s third gold boom started in 1982 and is still continuing. In this period Australia has produced around 9,500 tonnes of gold and had become the world’s second largest gold producer.”  However it may well now have been overtaken by Russia in this latter respect if the Metals Focus figures are correct.

Table: Australia’s largest gold producers for the 2021-2022 financial year

05 Sep 2022

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