The Immensity of South African Gold Production
South African is the largest gold producer in the world. South African gold production has been steadily producing gold since 1886. South African gold production is considered by many as the Gold Mecca of the world. The Southern tip regions of Africa have dominated the gold market since it started.
South African gold production is mostly underground operations which reach as deep as more than 3.8 kilometers below the surface.
Gold Dominance
During its peak production in 1970, South African gold production comprised 79% of the total world annual supply. South Africa gold production however has decreased for the past 27 years. Despite lower productions, South African gold production is still the number one worldwide followed by United States then Australia.
South African gold production still makes up 25% of the total gold production every year. The dominance may have been reduced because of the discovery of other major gold-producing areas in North America and Australia.
South African is still the dominant player in the gold reserves category. South African gold production suffered some setbacks lately when manpower reduction and rationalization resulted in huge cost reductions in the gold industry. Despite these setbacks and the fact that North American mines have higher expenses allotted for gold production, South Africa gold production still managed to post profits even at low gold prices.
When US President Richard Nixon closed the gold window in 1971, a number of gold investors became overnight multi millionaire. South African gold production stocks rose quickly when the bullion improved. However when gold stocks plummet, do did the South African gold stocks prices.
The volatility of the gold market is evident in the case of JSE in late 1992. JSE All-Gold Index increased more than 230% sometime in 1993-1994 during the bull market. It went down sharply at 73% from the peak in the bear market.
It reached its lowest point in March. But today the JSE reflects a positive ALL-Gold index of around 60%. More than anything else, this proves that all kinds of securities or investments are cyclic.
Gold is the biggest mineral earner for South Africa. It rakes in at least 27.4% of the total mineral revenues. South African gold production also employs around 56% of South Africa's mine workers.
Increasing South African gold production should be the government's goal for the future if they want to maintain their dominance in the world market worldwide. This can be attained through an increase in productivity.
