Higher gold prices lead to reduction in production during March quarter, Surbiton Associates say - Kalgoorlie Miner9 Jun 2025 11:55
Interesting comments from Surbiton Associates...
“Effectively, the recent decline in Australian gold production was largely the result of higher gold prices,” Surbiton Associates director Dr Sandra Close said.
“At today’s gold price the March quarter’s output is worth over $12 billion, so understandably many producers are optimising their operations in response to such price increases.”
Dr Close said the higher gold price had made lower cut-off grades economic because what was unprofitable to mine and treat in the past had now become profitable.
“If operations are able to lower their cut-off grades, then a greater amount of gold is recovered from each orebody,” she said.
“Also, higher gold prices mean that it is economic to reclaim more low-grade material from stockpiles to feed into the treatment plants, so the weighted average head grade of ore being treated declines.
“Although lower head grades result in less gold being produced and means cash costs and AISC costs per ounce increase, the value of each ounce of gold is higher.
“Surbiton Associates’ latest analysis shows that low-grade, reclaimed stockpiled material is currently as high as around 15 per cent of the total ore being treated.
“Thanks to increasing gold prices, the proportion of low-grade material being blended into feed has risen steadily for the last five quarters, from a proportion of only around one per cent a year ago.”
https://www.kalminer.com.au/news/regional/higher-gold-prices-lead-to-reduction-in-production-during-march-quarter-surbiton-associates-say-c-18962390
Sign In
Follow the stocks
