SA mining production continues weak streak

7th June 2012 By: Natasha Odendaal - Creamer Media Senior Deputy Editor

JOHANNESBURG (miningweekly.com) – South African mining production continued to remain weak during April 2012, with volumes falling 10.6% year-on-year, Statistics South Africa reported on Thursday.

This compared with a revised 8% decrease in March 2012.

April was the tenth consecutive month of seasonally adjusted production contraction on a yearly basis.

Platinum production plunged 28.1% year-on-year, diamond production fell by 22.8%, manganese ore output by 22% and gold production declined by 12.8%.

The three months to April saw seasonally adjusted mining production decreasing 7.6%, compared with the three months ended January 2012.

Total production - on a seasonally adjusted basis - increased by a marginal 0.9% month-on-month, down from 6.5% in March. Banking group Nedbank attributed the marginal improvement to weak platinum volumes, which only increased 0.5% after a 33.8% jump in March, and a 1.4% drop in gold production.

Between March and April, gold and manganese ore production fell 1.4% and 6.8% respectively, while nickel and iron-ore increased 10.9% and 2.8% respectively.

Fragile general economic conditions, poor global growth prospects and difficult operating conditions in the mining sector would continue to undermine the performance of mining production in the months ahead, Nedbank commented.

Mineral sales during the first quarter of 2012 increased 6.9%, compared with the comparative period in the prior year, as gold, coal and iron-ore contributed 5.6, 4.8 and 1.6 percentage points during the three months to April.

Platinum-group metals recorded a 5.9% drop in mineral sales for the period.