Mining to the rescue A s the world and South Africa brace for soaring oil prices following the US-Israel- Iran conflict, the future is looking increasingly bleak. By the second week of
exports. Gold and PGMs account for about 40% of South Africa’s mining production and employ about 262 000 people out of the industry’s 474 000-strong workforce. “Mining should be a sector of national economic priority. Given the government’s continued social expenditure to avert social distress, and to deliver essential basic services and infrastructure, mining’s ability to deliver, ensure its future growth, and to leverage its employment multipliers, the sector has an important role in South Africa’s future social and economic security,” said Mzila Mthenjane, CEO of the Minerals Council. He added though, that given the current outlook for mining volumes which continues to contract, the council would like to see incentives for mining in future budgets that encourage exploration as well as assistance to sectors that are under distress such as ferrochrome and diamonds to increase production and to sustain and grow jobs in longer term. In this edition This issue delivers a strong focus on sovereignty (pg 14) and the World Gold Council’s insight on the drivers for the surge in demand for gold, including flagging a new market entrant - Tether, a US dollar-pegged stablecoin. With the stablecoin business approaching $200 billion in scale, Tether represents a meaningful financial force and, if it continues accumulating gold, its impact could grow significantly, the World Gold Council’s John Reade tells Modern Mining (pg 10). Also of note is an interview with Cora Gold, which is eager to begin construction of its flagship Sanankoro Gold Project in south Mali (pg 18) and Firering Strategic Minerals, which is advancing several parallel initiatives. These include diversifying its lime product range, expanding into new markets in Zimbabwe and Zambia, and advancing ancillary revenue streams such as the development of a cement plant for limestone powder production (pg 20). Commodities Outlook, with an article on How Rare Earths are powering the green transition (pg 8), Silver’s rise and fall: volatility versus
March, oil prices surged over 20% to pass $100 a barrel. The closure of the Strait of Hormuz, a critical maritime oil chokepoint, with roughly 20% of global oil consumption and 20% of liquefied natural gas (LNG) flowing through it, added to the world’s fuel woes. The conflict sees continued damage to key infrastructure and loss of lives with the resultant supply chain chokehold on fuel set to impact all trading partners. Referencing the conflict, Dr Azar Jammine, Chief Economist at Econometrix, a keynote speaker at the recently held Afrisam Budget
Breakdown Breakfast, advised that imminent shortages of supply are
going to change the global environment in a significant way, with the price of goods and services set to soar, and “as a consequence, interest rates around the world may not come down to the extent that we anticipated”. Given its location at the southern tip of Africa,
According to the Minerals Council South Africa, the upswing in prices for gold and platinum group metals (PGMs) contributed to the R21.3 billion increase in gross tax revenue.
Nelendhre Moodley.
South Africa—long regarded as an unsafe place—finds itself favourably situated and removed from the direct theatre of war. For some good news on the homefront – the mining sector has, once again, come to the rescue of the country, helping alleviate fiscal pressure and reduce the need for sharper tax increases by providing substantial tax revenue and foreign exchange. High precious metal prices, particularly for gold, have significantly boosted export revenue in recent months. Gold has remained above $5 000 /oz given its safe-haven asset status, with silver and platinum also experiencing sharp gains. According to the Minerals Council South Africa, the upswing in prices for gold and platinum group metals (PGMs) contributed to the R21.3 billion increase in gross tax revenue. Mining tax collections increased by 29%, mainly because of higher gold and PGM prices and increased chrome and manganese
Editor: Nelendhre Moodley e-mail: mining@crown.co.za Advertising Manager: Rynette Joubert
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