The gold mining industry is facing challenges in maintaining production growth, as finding new deposits has become increasingly difficult. According to the World Gold Council (WGC), mine production only grew by 0.5% in 2023 compared to the previous year, marking a slowdown in growth over the years.
WGC Chief Market Strategist John Reade highlighted that the industry has plateaued since 2016-2018 due to the dwindling availability of prospective areas for exploration. He mentioned that large-scale gold mining is capital-intensive, requiring significant investment in exploration and development that can take up to 10-20 years before production begins.
Securing government licenses and permits is another challenge for mining companies, especially in remote areas where infrastructure development is necessary. With approximately 187,000 metric tons of gold already mined in history and another 57,000 tons remaining unexcavated, the industry is grappling with rising geopolitical tensions affecting gold prices that hit record highs recently.
The current price of gold stands at $2,330 per ounce, reflecting the ongoing demand amid global uncertainties.
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