Mining production decreased by 9.1% year-on-year in July, with the largest negative contributors being other nonmetallic minerals and chromium ore sector.
Other non-metallic minerals contributed -2.8 percentage points to the decline with an overall decrease of 44.9% in output, while chromium ore decreased by 32.5% and contributed -1.4 percentage points.
The third-largest negative contributor was iron-ore, with a 19% decrease in output and contributing -2.1 percentage points; followed by gold decreasing by 10.2% and contributing -1.3 percentage points.
Coal, meanwhile, declined by 8.5% and contributed -2.4 percentage points to the overall decline of the sector.
Seasonally adjusted mining production increased by 20.2% in July compared with June. This followed month-on-month changes of -1.9% in June and -50.5% in May.
Seasonally adjusted mining production for the three months ended July increased by 3.7% compared with the previous three months.
The largest positive contributors were manganese ore (at 34.9% and contributing 2.1 percentage points) and platinum-group metals (PGMs), which increased by 6.6% and contributed 1.4 percentage points).
Overall, mineral sales increased by 11.3% year-on-year in July, with the largest contributors being PGMs at 23% (5.1 percentage points), gold at 12.7% (2.3 percentage points) and coal at 5.8% (1.4 percentage points).
Seasonally adjusted mineral sales at current prices increased by 24.3% in July compared with June, which followed month-on-month changes of -3.3% in June and -26.7% in May.
For the three months ended July, the seasonally adjusted value of mineral sales at current prices was 3.5% lower compared with the previous three months.
With yearly mining production having declined for five consecutive months, Nedbank Group's economic unit says that, although concerning, the trend over the last three months “has shown a deceleration rate of the decline in production”.
Nedbank expects mining to remain weak for the remainder of the year but says it will likely be at “vastly better levels” than at the height of the lockdown, when mining production plunged by 51.3% in May.
“The speed of this recovery will depend on how quickly the country moves towards some semblance of normal operations. Which, depending on the source, could be as soon as later this year, or sometime in 2021,” the unit comments.
Either way, Nedbank says mining production will likely end the year on a lower number, as it has been hurt by much weaker global demand and commodity prices.