After declining in 2019, global gold production was adversely affected by the covid-19 pandemic during 2020, while the suspension of expansion works and contractions from mines nearing closure also exacerbated the decline. Overall output in 2020 was estimated to have declined by 5.2% to 108 million ounces, according to UK-based analytics company GlobalData.
This year, however, total production is expected to bounce back and increase by 5.5% to 113.9 million ounces and then grow to 124.1 million ounces by 2024 – a 2.9% compound annual growth rate (CAGR).
Indonesia, Peru and the US will be the key contributors to this growth, GlobalData says. Combined production in these countries is expected to recover from an estimated 20.1 million ounces in 2021 to 25.3 million ounces in 2024.
Key projects expected to commence operations during the forecast period include Barrick and Newmont’s Turquoise Ridge underground expansion project in Nevada, which is currently undergoing construction. With an annual gold production capacity of 500 kilo ounces, the project is expected to be commissioned in late-2022.
The greatest impact of covid-19 on gold production was observed during the first half of 2020, when six of the top 10 gold producers reported a collective 8.4% year-on-year fall in their output.
China, after reporting an all-time high of 16.7 million ounces of gold production in 2014, has been on a downtrend ever since, as a consequence of policy changes and depleting ore reserves. China’s gold production is estimated to have declined by 7% to 12.4million ounces in 2020, according to GlobalData.
The pandemic also had a significant impact on African operations mainly during the second quarter of 2020, where gold production is gradually shifting its base towards Western African countries.
Overall, gold production from South Africa is expected to have declined by 10.9% in 2020, with declines also in Guyana (15.9%), Ghana (7.5%) and Mali (5.6%).
In Indonesia, production is expected to have declined by 28.9%, owing to the transition of the Grasberg open-pit mine, the country’s largest producer. Unlike other key producers, GlobalData reports, Australian gold miners remained largely unaffected by the outbreak, as stringent measures were adopted by the government to contain the outbreak enabling minimal disruptions to mining activities.